John McDonnell Banking Opinion, Guardian, Wednesday 22nd March 2018
The revelations published in the Guardian yesterday about the criminal network that is processing money through major British banks are a damning indictment of the failings of our banking system. For a period of at least four years, shortly after the financial crisis in the early 2010s, Russian criminal interests moved nearly $740m through British banks, including HSBC, RBS, Barclays, Lloyds and Coutts, with HSBC as the largest conduit by far.
They could do this, despite regulations expressly designed to prevent such activity taking place. Yet, when presented with a series of urgent questions, demanding answers and action, the response from the government was astonishingly complacent. A mere week after the self-employment tax U-turn, it is following a path well-worn since 2010 – pathetically easy on the big banks and the super-rich, but tough on those just trying to earn a living.
George Osborne, the then chancellor, intervened directly into a 2012 US investigation into HSBC’s money laundering, emailing the Department of Justice (DoJ) to warn that prosecuting Britain’s largest bank would lead to a “global financial disaster” and “financial calamity”. A later Congressional investigation found that the intervention, by the now new editor of the Evening Standard, “played a significant role in ultimately persuading the DoJ not to prosecute HSBC”.
It was under Osborne’s watch that the bank levy, introduced by the last Labour government to claw back some of the astronomical returns major banks had been making, was phased out, in his first budget after the 2015 election. HSBC had previously threatened to leave the country if its £700m bank levy charge wasn’t reduced, lobbying the government heavily. Osborne’s new tax regime for banks, introduced in summer 2015, instead leant...
Let me thank the Chancellor for providing me with an earlier sight of his statement.
I say to the Chancellor: his complacency today is astounding.
We face – in every public service – a crisis on a scale we’ve never seen before.
Hasn’t he listened to the doctors and nurses, the teachers, the police officers, the carers and even his own councillors?
They are telling him they can’t wait for the next Budget. They’re telling him to act now.
For eight years they’ve been ignored by this government.
And today - they’ve been ignored again.
The economic reality
The Chancellor has proclaimed that there is light at the end of the tunnel.
But this shows just how cut off from the real world he is.
Last year growth in our economy was among the lowest in the G7 and the slowest since 2012.
Wages are lower now - in real terms - than they were in 2010 – and they’re still falling.
According to the Resolution Foundation, the changes to benefits due to come in next month will leave 11 million families worse off.
And – as always - the harshest cuts are falling on disabled people.
Productivity and investment
The gap in productivity between this country and the rest of the G7 is almost the widest for a generation.
UK industry is 20 to 30% less productive that in other major economies.
Well, part of the reason is that investment by this government, in real terms, is nearly £18 billion below its 2010 level.
Business investment stagnated in the last quarter of 2017.
4th Industrial Revolution
The Chancellor talks about the 4th Industrial Revolution but Britain has the lowest rate of industrial robot use in the OECD.
And the government...
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