Link to this page: https://secure.socialistparty.org.uk/issue/658/11188
The Socialist 16 February 2011 |
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News in brief
There seems to be no limit to how much UK banks can gorge themselves on public funds. According to the New Economics Foundation, on top of the estimated £1 trillion shovelled into the black hole of the financial system by successive governments, British banks are pocketing at least £32.5 billion extra in hidden subsidies.
The NEF reckons that these hidden subsidies fall into three categories. Firstly, the "too big to fail subsidy". Banks effectively save £30 billion each year in borrowing costs that companies without state guarantees have to pay.
Secondly, the Bank of England's "quantative easing" stimulus programme subsidy. NEF reckons that: "Merely for being passive conduits for this risk-free arrangement, the banks made more money, taking a cut of every trade."
Lastly, the "make the customer pay subsidy". This is worth around £2.5 billion annually, and represents the high rates of interest charged to borrowers by the banks in order to rebuild their capital.
'Big society' con
Socialist Party member Nick Chaffey ripped into the Tories 'Big Society' policy on the BBC's The Big Questions programme, broadcast from Southampton on Sunday 13 February.
As a member of the audience Nick made it crystal clear in his many interventions that prime minister David Cameron's 'Big Society' idea was a fig leaf for massive public spending cuts.
To loud applause Nick pointed out that when the Tories talk about 'rolling back the state' from people's lives what they really have in mind is destroying library services, youth services and social services for the poor and elderly - while the rich get richer.
See Nick giving the Tories 'both barrels' via the BBC's iplayer.
Cuts will kill
Charities have warned that more victims of domestic abuse could end up dying at the hands of their abusers as a result of government spending cuts. This warning comes after more than half of domestic violence services across the country reported that they do not know if they will be able to remain fully open after local government spending cuts go through in March.
Channel 4 News reported a survey on 7 February which found that only one-quarter of refuges have had their contracts extended beyond March so far. Some 37% of services say they will either close or face serious risk of closure.
As the government's Supporting People grant to local authorities is not ring fenced, cash-strapped councils are channelling some of it to other services. Also, some larger councils have faced disproportionate cuts in funding as a result of the formula for local government funding.