UK Politics

Labour Party: Osborne's bank levy announcement is hurried, panicky and a damp squib - Ed Balls

News   •   Feb 09, 2011 11:02 GMT

Ed Balls MP, Labour's Shadow Chancellor, commenting on today's announcement on the bank levy and stalled project Merlin talks said:

“After all George Osborne’s tough talk on the banks in recent weeks and months, this morning’s hurried and panicky announcement is a damp squib.

“While we welcome the fact that George Osborne has listened to our calls to raise more from the banks this year his announcement today does not go far enough. If George Osborne was serious he would adopt Labour’s plan to repeat last year’s £3.5 billion bank bonus tax on top of the bank levy. With the economic recovery stalling we would use the money raised to help create the jobs and growth we badly need this year.

"Without this bank bonus tax – and with the banks set to benefit from a corporation tax cut – George Osborne has actually delivered a tax cut for the banks compared to last year, even after today’s announcement.”

On ‘Project Merlin’, Ed Balls MP said:

“This panicky announcement seems to be a fig leaf to hide George Osborne’s failure to get a deal on the Project Merlin talks with the banks.

“There are three questions the Chancellor needs to answer if he is to get a credible agreement with the banks on lending, transparency and bonuses.

“Is there an agreement on boosting bank lending that can actually be enforced and measured?

“Is there an approach to transparency which will be fair and can be agreed internationally, especially since the government is demanding local authorities publish salaries of individuals earning over £58,200?

“And on bonuses, is there an agreement that delivers on all the rhetoric and pledges he and David Cameron made before the election?

“We will have to keep waiting for an announcement on the Project Merlin talks before we can judge whether George Osborne has delivered. Until then, people will rightly conclude that so far George Osborne has been all talk and no action.

“With no agreement with the banks, no progress on an international agreement on transparency or a financial activities tax and no plan B to get the economy growing again, the Chancellor’s delay and prevarication is now further undermining confidence in economic recovery.”