Public sector support for the banking sector amounts to at least £1 2 trillion committed, equivalent to 85 per cent of GDP – the highest level of any comparable economyIn 2008, the Government issued the biggest single public bail-out in history to rescue major retail banks in the middle of a credit crisis.
A new report from the New Economics Foundation reveals that:
- Public sector support for the banking sector amounts to at least £1.2 trillion committed, equivalent to 85 per cent of GDP – the highest level of any comparable economy
- Despite this scale of support
- new lending to households and firms has stagnated
- While banks’ own profits have
- and banks’ reliance on high-risk securitisation processes has scarcely reduced
- Projections are that in 2011 the Bank of England will need to borrow £25billion per month, equivalent to:
- half of annual current expenditure on education
- one-quarter of annual current expenditure on health;
- more than the total value added of the electricity, gas and water supply industries; and
- three times the value added of the agriculture, hunting, forestry and fishing industries.
Nef asks where our money went, who has benefited from it, and what was asked of the banks in return.
It makes recommendations for a fairer, more transparent, and most importantly more stable banking system.
You can download their report from the nef website here: http://www.neweconomics.org/publications/where-did-our-money-go?
Or from the Transition Farnham website here.