Deputy Prime Minister Nick Clegg has publicly thrown his weight behind plans I launched in March to give nationalised bank shares to the people.
We all remember the financial crisis in 2008 and 2009, culminating in the state riding to the rescue of two huge British Banks, Royal Bank of Scotland and Lloyds Banking Group. That bailout cost us roughly £66billion, adding to our national debt. The Treasury now owns about 80% of the shares in RBS and 43% of the shares in Lloyds.
The banks are now recovering and will return to profitability. Sometime in the near future the Government will want to dispose of the shares. But I don’t want a repeat of the privatisations of the 1980s and 1990s. That would mean only those with surplus cash could buy the shares. Instead I want the Treasury to distribute the shares to every adult. We would all benefit from any increase in the share value and get dividends. But when the shares are sold the Treasury would claw back the original bail out cost. This way the Treasury will get to reduce the national debt and each citizen would receive a cash bonus.
We all, in some way, have suffered from the financial crisis. It is right that we should all get some pay back when the banks are back to financial good health. The idea has been gathering new supporters and is being considered by the Treasury, where I will be meeting senior civil servants next week.
You can read more about my original proposal here: http://centreforum.org/assets/pubs/getting-your-share-of-the-banks.pdf