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It's the symbolism, stupid

Nick Robinson | 09:25 UK time, Tuesday, 8 February 2011

When a tax rise is announced outside of Budget time (see my previous post), it's fair to assume that the announcement may have as much to do with politics as it is about economics. When you're raising less than a billion pounds that impression is bound to be reinforced.

The Tories bashed the banks in opposition to symbolise that "we're all in it together". Now, Labour in opposition are using ministers' failure to curb banks bonuses to back up their assertion that that claim is hollow.

At Prime Minister's Questions last month Ed Miliband accused the PM of living on "Planet Cameron" where taxes went up for ordinary people and down for the banks. "The country" he said "is getting fed up with the prime minister's pathetic excuses on banks". David Cameron accused him of bailing out the banks and asking for "nothing in return".

Labour's aim is to "re-contaminate" the Tory brand. George Osborne's objective today was to make that just a tiny bit harder.

It's not really a clash about the banks or the economy. It's about the symbolism, stupid.

Update 11:00: The Treasury insists that the George v Ed show had nothing to do with the timing of today's tax announcement. The reason for the curious timing they say was the need to ensure that any commitment the banks make to increase lending under Project Merlin is not threatened by their reaction to a tax increase announced after the deal was done.

The message now to the banks is "you know where you stand" - if you deliver on loans, bonuses and transparency you are guaranteed a stable and predictable tax environment with no nasty tax surprises around the corner. On the other hand, if you don't deliver "nothing is off the table".

Comments

  • Comment number 1.

    The only 'symbolism' I can see here is that of a man of class and education up against the most bumptious shadow chancellor in decades.

    pdavies and sagamix can do all the wishful thinking they like about how the chancellor feels with respect to his opposite number; the reality is he probably doesn't give a monkey's.

    And wasn't it Ed Balls who signed off the 'Christ the King' school in Liverpool as part of the building schools for the future program...? This cost £24m to build but is now going to cost the taxpayer £159m thanks to the inept PFI scheme. And guess what? It has closed down. Another terrific newlabour siccess story.

    I should George Osborne can't wait to stand up and ridicule his opposite number for his financial sleight of hand over the past thriteen years...

    It's grim up north London...

  • Comment number 2.

    George 'Prudence' Osborne. Another step in the right direction - away from the bed that Labour shared with firms that caused the financial crisis.

  • Comment number 3.

    Yes, but the symbolism represents a profound weakness in the GO approach which springs from his natural ideological free market beliefs where ultimately the banks will be left largely to their own devices. Change will be cosmetic. It is the same approach that says pummel the public sector and it will bring forth a great flowering of private enterprise growth and employment. That is why the 'growth plan' will also be a triumph of presentation over substance.

  • Comment number 4.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 5.

    Yes, poor from Osborne, isn't it? Bit weak too. Clearly more interested in warding off big bad Balls than in reforming the banks. Doesn't bode well for the country.

  • Comment number 6.

    Too right, it is stupid!

    After the sordid mess of the last Labour government the Labour Party needs to go back to basics and rediscover its roots. Instead it is trying, as you rightly say, to smear the Tory brand in the hope that by dragging the Coalition down to the same incompetent level Labour might just win the next election.

    This is not politics it is squalid opportunism of the most revolting kind.

    The general election result showed that no party won. Surely, this should now mean that there is a coalition of all the talents. This is always assuming there is any talent to be found in Parliament today.

  • Comment number 7.

    Only getting an extra £800million out of the banks is indeed very symbolic. It's symbolic of how little the Tories are willing to squeeze out of them, and how much they're willing to squeeze out of the rest of us.

    Screw every last penny out of the banks. The country is in serious trouble and they are, amazingly, still striking fear that they will disappear overnight if provoked.

  • Comment number 8.

    Robin @ 1

    You're sounding a bit rattled today. Are you worried that your man of "class and education" is going to get mauled by an oik? Will Osborne put his fists up and declare "Queensberry rules" only to be felled by a low punch? In fact, Balls' biggest weapon is not his force of character, it's the fact that he knows what he's talking about. This is acknowledged even by his enemies. Osborne has always been seen by Tory strategists as a weak link. Let's see what happens when pressure is applied.

  • Comment number 9.

    Never was a Labour shadow chancellor more aptly named.

  • Comment number 10.

    Lets see. Take a billion out of the bank's capital At 10:1 gearing, that is 10 billion of loans that aren't going to be made.

    So what's really going on. It's deception. The government is trying to distract from its own mess. With its debts at 6,800 billion, any blame it can pin on other people means it can carry on increasing the debts.

    I personally wouldn't want to be a civil servant. For the simple reason that you've lent your entire pension fund to the government and its spent the money

  • Comment number 11.

    #5 13 years of labour lies and failure to take them to task by BBC and NR will haunt this country for generations to come.

  • Comment number 12.

    Who is going to believe anything that Balls says? He was one of the instigators of the huge deficit that hangs around all our necks.

    Whatever he says will be seen as blatent hypocracy however bullish he may present it!!

  • Comment number 13.

    Robin, it's almost like you're sat there at the keyboard waiting for a new Blog to pop up just so you can do the #1 post. Which is fine but you should try to stay on topic - being how Osborne seems to be terrified of Balls. Hope he isn't (as explained at 13 prior thread) but it seems that he might be.

  • Comment number 14.

    It is the symbolism, but it is sadly hollow politicking from a government that is intellectually lite. Whether its massaging figures on the NHS reforms, pointless and unpopular Forest legislation or the hollow pithy Big Society to cover up the real impact of the cuts.

    George Osborne will have to do much better than this to reverse the perception of a dishonest government. http://bit.ly/dPSH0q

  • Comment number 15.

    #8 balls knowing what he is talking about yoour having a giraffe

    when he was schools/choldren minister he made sure that Sharon sizsmith got the can for labour policy over bady-p.

    and that all he his good at so far avoiding the blame for his policies

  • Comment number 16.

    Let's get something straight: Messrs Brown & Darling (Balls) bailed out 2 banks, missed an opportunity to re-draft bonus eligibility & payments. And by the wayd they de-regulated those same banks. On the other side of the coin we (as consumers) borrowed more than we could repay.
    So why should those banks not needing a bail out, who manage their business well be pressurised not to pay bonuses?

    Marilyn 101

  • Comment number 17.

    Still awaiting a balanced and impartial report from you Nick. I thought that was the BBC was supposed to be all about?

  • Comment number 18.

    pdavies...

    Ed Balls may 'know what he's talking about' but knowing what you're doing is a different matter and the 'Christ the King' episode in Liverpool is a national disgrace and down to his fumbling hand.

    It's grim up north London...

  • Comment number 19.

    pdavies...

    and as far as 'knowing his subject' is concerned with respect to your man Ed Balls... What it is prime objective while minister for schools and children to make sure that they didn't 'know their subject'?

    That certainly seem to have been the result..as Britain collapsed from 5th and 6th places in English and Maths to 25th in the world after thirteen years of newlabour jet hosing with cash.

    Your problem is that Ed Balls may 'know his subject' but he also has a track record. And right now his old teachers would be saying 'must do better'.

    You can run but you can't hide. and you can shuffle the deckchairs on your personal version of the Titatanic but Captain Miliband failed to spot the iceberg that was newlabour's track record.

    Rattled? Moi? You wish.

    it's grim up north London...

  • Comment number 20.

    This blog is fast becoming the "SUN" & "MIRROR" of the BBC, its more about the headline than the content. Must have been spending too much time with the spin doctors Nick I fear.

  • Comment number 21.

    IR35 @ 15

    Balls knows about economics, is what I meant. Even his enemies agree, although they may disagree with some of his opinions.

    I don't think the death of Baby P has much to do with Labour policy. Local child protection agencies failed, but they have an almost impossible job. 100% of the blame lies with the mother, her boyfriend and his brother - they were the ones who killed him.

  • Comment number 22.

    "Labour's aim is to "re-contaminate" the Tory brand."

    I presume there was no shortage of volunteers when asked for a show of hands in The Pillars Of Hercules, eh Nick?

    What with the defection of one of your own to the hated tories, how many pieces of silver are there on offer to such willing shahidi?

  • Comment number 23.

    It is Money stupid!

    HM Treasury isn't getting the tax receipts it expected so needs to raise more money to provide a rebate or abolition of the fuel duty escalator in April.

  • Comment number 24.

    sagamix..

    may I remind you how hard your lot tried to get rid of George Osborne during the Rothchild/Mandleson/Deripaska affair...

    Never have I seen a politial party move so fast to try and destabilise an opposition as during this time.

    But if Osborne can't be ruffled by all the powers the Prince of Darkness can summon, he's not going to be budgeod by this little pip squeak.

    it's grim up north London...

  • Comment number 25.

    I don't think he should be worried about what Labour say and the coalition generally should have more self-confidence. They say theyre going to seel off the forests, Labour and the unions kick up a fuss and then the coalition back down. Poor leadership, they need to grow some balls because the vocal minority do not represent the majority who voted for them.

  • Comment number 26.

    #17 NR is very pro New Labour but he will be gone soon and Luara Kunesburg is taking over , she is much more on the ball, unlike Mr Balls

  • Comment number 27.

    Re 4 - Please to balance out this complete miss-understanding of the legislation by George Monbiot....

    The guy just doesn't understand what he's talking about.

    All this is doing is aligning the current treatment of exisiting overseas subsidiaries with overseas branches.

    'Controlled Foreign Company' legislation is to be extended to branches as an anti-avoidance measure so there won't be anything a UK company can get away with that it couldn't already simply by setting up a foreign subsidiary company.

  • Comment number 28.

    Robin@1

    Balls clearly likes to fall back on his image as a bit of a bruiser but as the son of an eminent professor, who attended a fee paying school before going to Oxford, he is hardly a class warrior.

    Should be an interesting if bloody contest - the timing of Osborne's announcement is likely to be political but politicians will play games, it's in their nature.

  • Comment number 29.

    Quote: "Labour's aim is to "re-contaminate" the Tory brand."

    Call me Dave and Posh Boy Osbourne are doing a great job of that themselves...

  • Comment number 30.

    Labour looking to re-contaminate the tory brand is the daftest thing I ever heard.

    I presume one of your masters in BEEB-Land instructed you to come up with that nonsense?

    The only thing contaminated at the moment is the national accounts after thirteen years of newlabour 'stewardship' ... the education of our children that has deteriorated dramatically under newlabour stewardship ... and the contamination of our national identity and culture by newlabour's disasterously misguided experiment with multiculturalism.

    'Re-contaminating the tory brand' is going to be rather difficult coming form such a postion of nuclear toxicity themselves.

    It's grim up north London...

  • Comment number 31.

    "Nothing is off the table" Laughable considering both leaders have roots with the Finacial Services sector, Mr Cameron and Mr (I do not tell the truth) Clegg have family connections to the Banking and Stock Market sectors.

    I am really getting sick and tired of the defense of our financial institutions, this is yet another case of look at us be are bashing banks as well but not really and all this bluff and bull from a government who in my opinion has no legitimasy becuase they lied to get into power.

    Could this announcement be because the banks have simply told Mr Osbourne to go forth, are we about to find out how much these bankers are really awarding themselves in bonuses.

  • Comment number 32.

    Good post! @watriler: ah yes - and your alternative is what? The Gordon Brown way, perhaps? That's like, the way that caused the problem in the first place?
    Forget legislation, it simply doesn't work (not least because those you are trying to control are smarter than the bureaucrats doing the controlling). Alter the playing field instead (which is what Osborne is trying to do - we'll see if it works)and you might actually control something!

  • Comment number 33.

    21 pdavies65

    Balls knows about economics, is what I meant. Even his enemies agree, although they may disagree with some of his opinions.

    >>>>>>>>>>>>>>

    Undoubtedly, he has a stronger grounding in the subject than Osborne, but that is more a reflection of Osborne than Balls.

    Had Cameron appointed someone like Redwood as Chancellor (sure that would have pleased the Libs) then it wouldn't be an issue.

  • Comment number 34.

    Symbolism or not, it seems that there is a mighty fight going on between the elected representatives of the people forming the government, looking after tax payers money, and the banks mafia. How is it that the banks executives think that they can reward themselves whatever they like, as if the banks belong to them? Don't they understand that they are simple employees of the banks with fixed salaries? Any transfer or attempted transfer of assets or capital from the company account by them is criminal offence? It is time that civil law suits should be initiated against such directors for stealing company assets.

  • Comment number 35.

    "This blog is fast becoming the "SUN" & "MIRROR" of the BBC, it's more about the headline than the content." - chris @ 20

    Reflecting exactly George Osborne's approach in bringing forward this announcement purely to aid his parliamentary debut versus Balls. Whether the media trivialises (tory in this case) politics or the reverse is moot, I suppose.

  • Comment number 36.

    Glad to see Nu Old Labour are rousing the troops in the fight against the Coalition.

    First we had Liverpool taking a very public steps away from the "Big Society" and now we have Manchester another Labour lead council makes a very public statement about the cuts it is making. However if you look at its budget then you will see the cuts are more about posturing than actual savings. More about headlines than the bottom line one may say....
    Or as a local said they cant hit us in our pockets so they are trying to hit us where they think it will hurt us the most that is why they are closing the toilets....
    please have a look and make your own mind up;

    http://www.manchester.gov.uk/

  • Comment number 37.

    Forget all the party political rhetoric in these comments. The facts are the banks owe the taxpayers billions for the bailout whether through direct government support, or by the insurance if they get into trouble in future we take on there bad (toxic) debts. There is no remorse, no sorry we got it wrong, instead they are about to announce a humungous amount in bonuses. So to add another 800million in tax levy is a pure politically motivated sop to the British public.

  • Comment number 38.

    'The Tories bashed the banks in opposition to symbolise that "we're all in it together". Now, Labour in opposition are using ministers' failure to curb banks bonuses to back up their assertion that that claim is hollow.'

    and the Troies have been good to their word. They've introduced a bank levy, as promised, which Labour criticised when were in government as being too harsh on the banks.

  • Comment number 39.

    Now you really do sound rattled, Robin (24). Almost as if you yourself are scared that Osborne's scared of Balls. The both of you need to grow a pair if you're going to come through this; be four onto one if you can (won't it?) so, you know.

  • Comment number 40.

    The revenue this will raise is a drop in the ocean. It's designed to be a crowd-pleaser, nothing more.

    But if the Tories really want to enthuse voters, they will have to do far more. There needs to be much tighter controls on Local Government waste.

    The country needs more librarians, not more traffic wardens.

  • Comment number 41.

    When Labour were in government, was it Ed Balls who responsible for Labours opposition to the Tories bank levy proposal (on the grounds it was too harsh on the banks?) or was it Ed Miliband ?

  • Comment number 42.

    Hello Andy (27), I do hope that post isn't drenched in the most unutterable hypocrisy - no place for that on here. It isn't? Good. Lessons learnt and we all move on.

  • Comment number 43.

    8. At 10:13am on 08 Feb 2011, pdavies65 wrote:
    Balls' biggest weapon is not his force of character, it's the fact that he knows what he's talking about.
    =========================================================================
    If I may be so bold, "his force of character" is no mare than a combination of arrogance and ignorance and there are very big questions about his economic prowess. He was as he openly admits the author of the Nu Labour economic policy under Superman Gordon. The same policy that spent, spent, spent during the boom times managing to run up a massive deficit even though we were generating more into the exchequer than at any other time. The man who up until he took over as shadow Chancellor wanted to return to the spending levels prior to the election and denied there was an issue with the deficit and our level of debt. However he has now had his "Road to Damascus" experience and done a swift U turn on his beliefs to get the job he wanted all along, mind you Mr Ed must watch his back as did poor old Tony for all those years. Never mind it's something the press can look forward to.

  • Comment number 44.

    Talking of symbolism, the project to make the banks lend more and curb bonus paid is called Merlin. Presumably this name is less embarassing than what it should really be called "Wishful Thinking"!

    Until the banks are separated between retail and investment nothing will change irrespective of who is in power politically. The Competition Commission of 20 years ago would never have allowed an RBS to buy out NatWest, nor Halifax merge with Bank of Scotland let alone allow the creation of Lloyds Bank Group. Big is not beautiful in the banking sector.

  • Comment number 45.

    'It's not really a clash about the banks or the economy. It's about the symbolism, stupid.'

    No doubt there's an element of symbolism Nick. And of course you'll make the same point whenever Labour claim they would increase the bank levy further, and extend the windfall tax on bonuses.

  • Comment number 46.

    Yep, pretty obviously just a (fairly transparent) political gesture.

    People deserve to see some serious action on the key issues - ending free underwriting of bank risk by the tax payer, recovery of the >£1tn the banks cost the nation etc.

    I won't hold my breath waiting for bertie wooster to deliver any serious action against his bosses in the city.

  • Comment number 47.

    1.rR7. I take it the fact the school was closed due to lack of attendance because Catholics and CoE would not mix is a point in terms of the cost of symbolism . In terms of PFI, I am trying to determine your objection. It was a great Tory invention, used aggressively by Labour. PWC and KPMG provide numerous reports on its success, and that school performance generally increased within PFI schools compared to conventional schools. Costs are higher because not only is it the cost of recovering the capital for the PFI but also they were required to maintain the schools, that otherwise local councils often neglected. I also fail to understand your point 18. Yes, they did slide down the table, but I am not sure how this can be blamed on building more schools more quickly with proven (by KPMG and PWC) increased performance? You seem to be a Tory, but are opposed to very clear Tory ideals when enacted. You blame Labour for dropping standards but all evidence suggests Ed did more, more quickly, and he used the best proven vehicle for raising standards. The Tories now are cutting the system without replcaing it, hence standards will drop generally not improve. The only objection can be to the deficit..., but then just say that

  • Comment number 48.

    'Labour in opposition are using ministers' failure to curb banks bonuses to back up their assertion that that claim is hollow.'

    Would that be the same Labour party that, when in government, handed out knighthoods to bank bosses, criticised the Torys bank levy proposal for being too harsh and lavished praise on bankers for helping to foster a new golden age in the City of London just before the biggest financial crash since the great depression ? Or is this some other Labour party you're referring to ?

  • Comment number 49.

    The reality after all this fake argument about Osborne and who may or may not have a better grasp of economics is that the chancellor has the undignified task of clearing up newlabour's mess.

    It's a grim old job putting right something that someone else has made horribly wrong.

    Osborne 'Prince of Darkness slayer' is the man for the job.

    It's grim up north London...

  • Comment number 50.

    21. At 10:52am on 08 Feb 2011, pdavies65 wrote:
    =========================================================================
    What about the fiasco with the student grants and then we have the problems with the examinations marking both of which happened under his leadership and which he tried to push under the carpet.

  • Comment number 51.

    #29 well they do have a lot of decaminattion to perform so I guess that they have plenty to spread about then

  • Comment number 52.

    I am reluctantly coming to the view that the labour party was better at managing the economy than the Tories. And I hated Brown and Balls.

    Osborne is drippy and ineffectual. £bn in bonuses- so he asks for less less than one Bn in extra tax. The bankers are just putting two fingers up to him.

    High time we asked these bankers for our money back if they want to be independant. Osborne is just wet and hopeless.

  • Comment number 53.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 54.

    36 Chris London

    First we had Liverpool taking a very public steps away from the "Big Society" and now we have Manchester another Labour lead council makes a very public statement about the cuts it is making. However if you look at its budget then you will see the cuts are more about posturing than actual savings.

    >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

    In a story from yesterday's Telegraph:

    http://www.telegraph.co.uk/news/newstopics/politics/8307435/Council-staff-on-58000-to-be-named-in-war-on-waste.html

    "According to an analysis of council accounts, in 1997 when Labour came to power the average local authority employed just seven people earning more than £50,000 a year. By 2008 this had risen to 81 people per council. Local authorities employing the most middle managers include Birmingham, Hampshire and Essex councils."

    Local authorities should be tackling bloated management structures before cutting front line services.

  • Comment number 55.

    #21 it was on his watch and it was their policy of mothers can do no wrong, father are always bad and boyfriends are ok that was the route causes all of which is a Nu-liebour policy,

    As for economics Balls was Brown left hand man so new exactly how to Ed B's an economy rigth up.

  • Comment number 56.

    If this is the strength of our government then Captain Mannering we really are doomed. Just how wet does this bloke have to prove himself before he is replaced ?

  • Comment number 57.

    DebtJuggler 4

    Just read the article. It's hilarious. Makes Lefty11 look restrained and rational. Anyone wanting to have a laugh at a bunch of lefty nutters (as if we don't get enough on here) suggest you do likewise.

  • Comment number 58.

    "42. At 11:55am on 08 Feb 2011, sagamix wrote:
    Hello Andy (27), I do hope that post isn't drenched in the most unutterable hypocrisy - no place for that on here. It isn't? Good. Lessons learnt and we all move on."

    hello Saga. Your post is drenched in the most unutterable nonsense. It means nothing. I was responding to a post claiming that a realignment of tax policy was somehow the worst tax crime in living memeory by pointing out that it was nothing of the sort.

    How could that possibly be hypocritical?

    Did you just feel the need to get the word 'hypocritical' into a post and decide that context and content was otherwise irrelevant? If that was your feeling, well done, job done.

  • Comment number 59.

    46. At 12:05pm on 08 Feb 2011, jon112dk wrote:
    =========================================================================
    Several points;

    1) The banks have not cost us Trillions as you suggest.
    2) If as was suggested at the time Northern Rock had been left to die a slow and agonising death then the rest would have taken head. This unfortunately was not a violable thing for Nu Labour for they had overseen the regulation of the banks that had allowed this to happen and also the main depositors where up North as they say and as such it would have hot Labour supporters particularly badly.
    3) Lastly we will only be hurting ourselves if we drive business else where. It's not about individuals its about organisations who will decide to trade in an area which is more favorable to their business. This is why the EU/ Euro zone is not taking any action and why the US and the majority of the developed and undeveloped world talk about taking action but never actually do or if they do water it down so much that its not worth the paper its written on.

  • Comment number 60.

    54.AS71. Using RPI 2008 50,000 equivalent to 1997 36,000. How many per council were earning that in 1997? Bloated anything should be cut out any system.

  • Comment number 61.

    No that's fine Andy (58), just checking. Thought I ought to after the crimes and misdemeanours of last week (when brazen hypocrisy seemed to be the order of the day). Excellent that you're back on track.

  • Comment number 62.

    47. At 12:05pm on 08 Feb 2011, inwiththew wrote:
    =========================================================================
    PFI was not a Tory invention it originated FROM Australia and was first used in the UK under John major's goverment.

    Its use increased greatly under the Labour Government without any thought about the true cost and the terms of the PFI agreements. In many cases it was not the original contract that made money it was the re financing that made the big bucks.

    As far as the the Big 4 supporting the programs well one may say they had a vested interest for they were making money all the way. They supported the buyers and suppliers alike and even took on the role of honest broker. Not a case of Jam today and tomorrow but all too often Jam forever. You just have to look at their fees for the PFI PPP programmes.

    What we have now is a legacy of payments for schools and hospitals that far outweigh their benefits. We also have buildings that in a number of cases that are no longer required or fit for purpose. I know of an NHS trust that is spending way in excess of 10% of its budget for its PFI contract and that will be the case for the next 30 years and guess what the life of the hospital was only ever going to be 25 years. I also know of schools which were built and closed by the last goverment and you guessed it we still have to pay for them.

    I for one am glad that this madness is coming to an end. The Idea was never meant for this type of programme it was originally based on road and inferstructure projects where the payback and costs could be easily calculated and monitored.

  • Comment number 63.

    jon112uk

    'ending free underwriting of bank risk by the tax payer'

    No need to hold your breath. The bank levy eliminates the free underwriting of bank risk that prevailed under New Labour. That's the same bank levy that Ed Balls and Ed Miliband opposed when they were in government.

  • Comment number 64.

    'A man of class and education'? 'Bumptious shadow chancellor'? Don't these remarks just reek of fulminating snobbery and classism? They sound like lines out of Evelyn Waugh. Shouldn't that read 'a man of absolute privilege and wealth' and 'a conviction politician with force of personality and intellect'?

    Maybe Ed Balls should know his place and doff his cap.How dare the man?

  • Comment number 65.

    54. At 12:16pm on 08 Feb 2011, AS71 wrote:

    well said

    "WELL OVER 100 public servants in Oxfordshire are earning more than the Prime Minister’s £142,000 salary — with many earning substantially more.

    Latest figures reveal that more than 224 people at Oxford University are paid more than £100,000, with 75 top-earners at the university receiving in excess of £140,000.

    It has also emerged that at least 130 GPs in Oxfordshire are paid in excess of £100,000, with 23 of them earning more than £150,000 and five more than £200,000."

  • Comment number 66.

    This is about brokering a deal as the govt has been frustrated that the banks don’t ordinarily want to play ball and are trying to sabotage or derail the Project Merlin. Hence the govt decides to flex its muscle and show who the boss is and hit them hard where it hurts - in their pockets so the banks will now have to re-think the bonus payments to be made and allow for the levy to be deducted before making bonus payments. It is the right & wise thing to do but it is still a very minimal amount compared to the payments that will be made to the bosses. Incidentally, the bank workers at the lower bottom of the ladder don't get as much bonus as their bosses. The govt is right to announce this just before the banks start dishing out bonuses so they know what to expect and payments to be made to the tax man before they start buying new yachts etc.

  • Comment number 67.

    Chris @ 50

    I didn't write any of that!

  • Comment number 68.

    An interesting bit of panto in light of George Monbiot's discovery that banks and large corporations - but not smaller businesses - will soon be getting tens of billions from Cameron in hidden tax breaks for their foreign subsidiaries.

    The banks are livid?

    Yes. I'll bet they are.

  • Comment number 69.

    Comment 59 at 12:40pm by Chris London - I note your points and yes it is right that we are cautious but you know what, we have been hearing the bankers argument about them taking their business somewhere else like Switzerland, Asia etc. Sooner or later they will return and relocate back to the UK because they will soon learn that unlike the UK business environment and regulation, other countries have much stricter rules and regulation and much tougher environments to operate in. Plus, the tax man will come after them like a rash. They will not have the loopholes that they enjoy to transfer money to off-shore accounts etc. That's what has attracted them and that's why the UK remains the central hub for banks in Europe. They use that as an excuse that they will relocate to other places. We also heard that argument about talent. There is surplus talent in the economy and some of the talent that the banks have are not the best or else we would not be in the economic mess that we are in. Will they relocate to Germany/France where they will have to learn the language to operate effectively as they cannot rely entirely on the local talent because you need international talent anyway? So in all honesty, they are really not going to go anywhere and if they tried, they will return. That is not to say/state that we shouldn't be mindful of introducing too many regulations that will stifle business because we believe in fair competition and should support businesses to thrive. What I personally object to as a Capitalist with a human face is excessive profit and unfair competition at the expense of communities, society etc.

  • Comment number 70.

    sagamix 61

    Are you hoping up and down on one leg while playing the ukelele singing my old mans a dustman ? Just checking.

  • Comment number 71.

    chris london @ 59

    Mistake to think the financial crash was more about Northern Rock than Wall St; more about the UK credit bubble than US mortgage bonds and the explosion in OTC derivatives. Re the (necessary) re-structuring of the industry, it will hopefully come via the relevant supra-national bodies and be implemented in all the main financial centres. This is something we should all support. Indeed if it doesn't happen, it will constitute a gross dereliction of duty. Worse, in a way, than the one we've already seen.

  • Comment number 72.

    Back Levy is still not enough.

  • Comment number 73.

    Everyone seems surprised that the banks run the government. Please review the past decade and results. The plan is and has been to protect the wealth of the wealthy, that is all, everything else is an after-thought. There is no recovery plan because the initial actions by the government to the crisis (crime) dictate these results.
    Those who caused the problem have been exempted by the government from participating in the solution, it is the victims who must pay.

  • Comment number 74.

    # 54 AS71 wrote:

    Local authorities should be tackling bloated management structures before cutting front line services.

    Of course, you are quite right. Why do some local authorities employ unelected 'Chief Executives' who earn considerably more than the Prime Minister?

    Inept Local Authorities need to have their wings clipped - yet Cameron with his 'Big Society' nonsense wants to give them more power.

    Services should also be prioritised according to public need. They should repair pot holes in the road before wasting money on so-called 'traffic calming' schemes.

    They should spend money where it actually does some good for the community. Librarians, not traffic wardens.

  • Comment number 75.

    "61. At 12:52pm on 08 Feb 2011, sagamix wrote:
    No that's fine Andy (58), just checking. Thought I ought to after the crimes and misdemeanours of last week (when brazen hypocrisy seemed to be the order of the day). Excellent that you're back on track."

    Oh grief, you're not still smarting from being made to look silly last week by your idiotic suggestion that it's hypocritical to support the idea of the Big Society unless you're prepared to give up ALL your time to charity?

    Honestly it's like having a sulky child still going on about losing a game of snakes and ladders two weeks ago.

    I'd have thought that as the self-appointed of TCP thinking you would have been a bit more grown up.

  • Comment number 76.

    Warm up match before facing Osborne: Ed Balls v Martha Kearney.

    Game over around the middle of the second half, a strong Martha leading 3-0. Then we are in injury time and Martha scores a brilliant goal. More to come, 93rd minute and ... whoa ...a battered, harassed Ed Balls puts it in his own net! It really is over now!

    Where was Gary Richardson?

  • Comment number 77.

    33. At 11:33am on 08 Feb 2011, AS71 wrote:

    Had Cameron appointed someone like Redwood as Chancellor (sure that would have pleased the Libs) then it wouldn't be an issue.
    -------------------------------------------------------------------
    I think it will be Ed Miliband doing all the appointing for a while ...

    Apparently, Dave is busy doing a PR job to shore up his own position.

  • Comment number 78.

    64#

    You're not aware of Bulldog Ball's background then? Or you are and you just choose to selectively ignore it? Conviction politician? Dont make me laugh.

    The only conviction Ed Balls should have is one for crimes against the state for which he should be serving a wholelife sentence with no chance of remission.

  • Comment number 79.

    59. At 12:40pm on 08 Feb 2011, Chris London wrote:
    46. At 12:05pm on 08 Feb 2011, jon112dk wrote:
    =========================================================================
    Several points;

    1) The banks have not cost us Trillions as you suggest.
    2) If as was suggested at the time Northern Rock had been left to die a slow and agonising death then the rest would have taken head. ==========================================================

    1) You assume I refer only to taxpayer handouts. I also refer the total loss to disunited kingdom GDP over the course of the recession which was caused by the banks.

    2) I make no comment that the banks should have been left to fail. I agree with cable that something needs to be done about the taxpayer providing free of charge underwriting for their risk taking.

  • Comment number 80.

    "68. At 1:17pm on 08 Feb 2011, RichardLeon wrote:
    An interesting bit of panto in light of George Monbiot's discovery that banks and large corporations - but not smaller businesses - will soon be getting tens of billions from Cameron in hidden tax breaks for their foreign subsidiaries."

    Monbiot's missunderstanding of these changes concerns branches, not subsidiaries. If you don't know the difference and can't work out why Monbiot's making an hysterical mountain out of a tiny molehill, I suggest you do some research.

  • Comment number 81.

    64 ttcarlisle

    'A man of class and education'? 'Bumptious shadow chancellor'? Don't these remarks just reek of fulminating snobbery and classism? They sound like lines out of Evelyn Waugh. Shouldn't that read 'a man of absolute privilege and wealth' and 'a conviction politician with force of personality and intellect'?

    Maybe Ed Balls should know his place and doff his cap.How dare the man?

    >>>>>>>>>>>>>>>>>>>>>>>>>>>

    Bumptious - crudely assertive, lacking restraint or modesty.

    The cap seems to fit Balls and therefore I suggest that he wears it rather than doffs it.

  • Comment number 82.

    If it was "all about the symbolism,"-getting tough with the banks so they know where they stand,it must be counted a failure.

    In relation to the stability and predictability of their relationship with the government it`s the equivalent of a small bomb in a crowded restaurant.Tax changes are normally announced in the budget,not in this ad hoc fashion.The excuse that the banks are now profitable,advance warning gives them time to plan as proposed by "smiling" Mike Fallon, is nonsense.They were profitable last year giving the government almost a year to fix the rate of the bank levy.

    The symbolism is not the one intended by the chancellor.The banks are "livid",unable to trust any agreement they may have entered into .Tough can be accomodated with planning,unreliable puts you in the clutches of unstable regimes where banks demand more security for compliance.

    The government rode to power on the fiction we risked a sovereign default if they were not elected.If they continue like this we risk a banking exodus because they were.

  • Comment number 83.

    #59 Chris,

    Ummm, I think you meant 'taken heed'

    Although I much prefer the slant that you have put on it!

    8)

  • Comment number 84.

    5. At 10:01am on 08 Feb 2011, sagamix wrote:
    Yes, poor from Osborne, isn't it? Bit weak too. Clearly more interested in warding off big bad Balls than in reforming the banks. Doesn't bode well for the country.
    -----------------------------------------------------------------------
    May only be the start. But then, it may not ...

    But what are we likely to get from Ed Balls if there is an election in October? The same? More of the same? Less of the same?

    Things are a bit vague with GO. But with Ed Balls, the future is decisive: "I won't do it like that. Don't know what I'll do but that's not important. It's not doing what they did that's important."

  • Comment number 85.

    65. At 1:01pm on 08 Feb 2011, Chris London wrote:
    54. At 12:16pm on 08 Feb 2011, AS71 wrote:

    well said

    "WELL OVER 100 public servants in Oxfordshire are earning more than the Prime Minister’s £142,000 salary — with many earning substantially more.

    Latest figures reveal that more than 224 people at Oxford University are paid more than £100,000, with 75 top-earners at the university receiving in excess of £140,000.
    ------------------------------------------------------------------------
    Is it true that now the Uni fees are set to increase, the top staff at the Uni are awarding themselves generous pay rises?

  • Comment number 86.

    "They should spend money where it actually does some good for the community. Librarians, not traffic wardens." - distant traveller @ 74

    I agree with your thrust (on Local Authorities), and with your general sentiment here, but you've selected a poor example - Traffic Wardens - for what should be low priority spending. Traffic Wardens, and plenty of them, are absolutely crucial for the well-being of urban communities. Perhaps you live in a rustic environment?

  • Comment number 87.

    andy @ 75

    Surprised that when given a lukewarm pat on the back and offered grudging congratulations on making a new start, totally free of rank hypocrisy, you choose to react like that. Not the way to get where we want to be.

  • Comment number 88.

    Whilst there is all of this rubbish about public servants earning more than the PM, I'm sure if The PM job was unpaid Mr Cameron would still have gone for it. When you look back I can't remember any of our underpaid PM's ever dying in poverty, and the majority of them seemed to get much richer after standing down. So comparing people's wages to that of the PM seems to be a waste of time and smacks of the Cameron hubris in thinking his earnings should be a benchmark for anybody other than all of his overprivileged friends.

  • Comment number 89.

    88#

    Whoever gave you that handle, steve I seriously suggest you ask for a refund. You've been had.

  • Comment number 90.

    "87. At 3:41pm on 08 Feb 2011, sagamix wrote:
    andy @ 75

    Surprised that when given a lukewarm pat on the back and offered grudging congratulations on making a new start, totally free of rank hypocrisy, you choose to react like that. Not the way to get where we want to be."

    I can't imagine ever wanting to be somewhere you'd want to be. You don't come across as a 'patio in the sunshine' sort of person. More a 'dingy living room with the curtains closed' sort of person.

    Besides, we'd established to the satisfaction of all rational people that only a fool would think there was any hypocrisy in what I said.....oh, I see....you did think that.

  • Comment number 91.

    Yes (90) I try to stay well clear of patios, this is true, but curtains - curtains! - no no no. Don't do curtains. People would laugh.

  • Comment number 92.

    Neither.

 

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