Government responds to our RBS petition!
October 15, 2015
Back in July Move Your Money launched a petition to end the RBS firesale, in partnership with Sum Of Us and the New Economics Foundation.
The petition clearly struck a nerve, with more than 119,000 of you signing – a fantastic achievement, and a real demonstration of the continued public demand for ethical and sustainable banking.
Yet despite the huge level of interest and our prominent petition hand-in stunt at the Treasury (that many MYM supporters attended), Her Majesty’s Treasury and George Osborne, the target of the petition, refused to answer – until now.
Or at least, that’s what it seemed like when we received a reply from Harriet Baldwin, the Economic Secretary to the Treasury – more commonly referred to as the City Minister.
Unfortunately, Baldwin’s response doesn’t actually engage with the arguments of the petition, or address the main ask of the petition – to hold a full, independent review of all the options for the RBS shareholding.
In fact, it’s not even clear if the City Minister has recognised this as a petition at all, with Baldwin failing to reference the 119,000 people who signed, or to recognise the clear public demand for and interest in a full review.
Her reply does make one thing clear though: that the government is determined to push through the RBS firesale, no matter how shaky its legitimacy is on this issue.
“The Government has been consistently clear that its objective in respect of RBS ownership is to return the bank to private sector in full,” she writes, providing no further justification for this stance.
The letter then goes on to reference the advice of Mark Carney, Governor of the Bank of England, Rothschild, the investment bank, and UK Financial Investments, which holds the shares on behalf of the taxpayer, all of whom unsurprisingly recommend an immediate sell-off.
What Baldwin’s letter doesn’t mention is that none of those advisors provide any evidence whatsoever for why the shares should be sold in the first place. The letter trail, such that it is, amounts to a round-robin of establishment back-slapping, where the only question is when the shares should be sold, not if they should be sold at all.
Perhaps the most thorough assessment is the report by Rothschild, as this does at least present some argument and evidence for its advice that if the shares are to be sold, they should be sold now – even though those arguments are qualified at best, and spurious at worst.
Even that report, though, readily admits that their analysis “has not sought to address the question of whether the Government should sell its stake in RBS, but rather when it should do so”.
So throughout the official documentation, no assessment has been made whatsoever as to whether the sale of the RBS shareholding is in the public interest in the first place. The assumption that private ownership is the best course of action is plain to see, and is never examined or questioned at all.
You would have thought that RBS going bust under private ownership would have been enough to challenge this assumption, or would have at least convinced the government to consider well-researched and convincing arguments for alternative ownership and operating structures for the bank. So far, that unfortunately seems not to be the case.
It’s a sad state of affairs when the government refuses to seriously consider the public interest in matters of such critical importance as the state and structure of the banking system. This is even more the case when the government’s own advisory body, the Parliamentary Commission on Banking Standards, also advised the government to undertake a full review of all the options.
In fact, it’s worse than just a sad state of affairs – it’s a full dereliction of duty, and an abandonment of the principles of a representative government acting in the interests of its citizens.
We’ve replied to Harriet Baldwin to express our concerns in full, and will continue to campaign for a full, independent and public review on all the options for the RBS shareholding.