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Tories promise discounted bank shares for all

The Conservatives have unveiled plans to offer discounted shares to voters when the state-owned banks are sold off.

Shadow Chancellor George Osborne says that under these proposals for a “people’s bank bonus”, younger people and those on lower incomes would be encouraged to save for their future.

Osborne says the move would allow those “who have suffered the most from Gordon Brown’s attack on our saving culture, to start saving for the future in a way that is suitable for them”.

He says: “Taxpayers bailed out the banks, so they deserve a ’people’s bank bonus’ when the time comes to sell the Government shares.”

But Liberal Democrat Shadow Chancellor Vince Cable blasted the Tories for “trying to buy votes”.

He says: “They have no understanding of the economy they are aspiring to run.”

Cable says the Conservatives should not be “dangling this prospect” in front of voters when it is likely to be at least five years before Royal Bank of Scotland will be back in private ownership.

He dubbed the move “Tory electioneering at its most cynical”.

Cable says the best strategy is to reprivatise the banks at a time which maximises return for the taxpayer and selling shares off at a discounted rate will not achieve this.

He adds: “Actively encouraging people on very low incomes to invest in a volatile share market beggars belief and shows just how removed the Tories are from everyday reality.”

Meanwhile, chief secretary to the Treasury Liam Byrne described the Conservative proposals as “an irresponsible and expensive political gimmick”.

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Comments

There are 4 comments at the moment, we would love to hear your opinion too.

  1. I though ‘we’ as in UK taxpayers and residents owned most of the bank shares as it was, selling them to ourselves is guaranteed to water it all down even further.

    The Tories are in urgent need of an injection of common sense, something they plainly believe is lacking down at the grass roots, I’m sure the institutions themselves will be happy with some discounted ‘shares’ because that is where they will end up..

  2. I agree with Vince.
    The idea that low-earners and youngsters should be investing in what is now a volatile market is both reckless and crazy.
    Next it will probably be tax relief on lottery tickets or on investment in football clubs.
    Politicians eh?

  3. How long are these banks going to be in public ownership anyway? 5 years? More? Less?

    No-one should be encouraged to invest in any form of equity unless it is for at least 5 years, even then 5 years is a pretty short time when dealing with an investor’s share portfolio.

    Also as Evan above says, there is bound to be a drag on both the underlying capital value and on dividends whilst the banks are repaying their debts. How can anyone possibly vote for Osborne to become Chancellor after this latest crazy idea? He says Labour has “attacked” our savings culture – oh yeah? If he was so concerned about savings why did Osborne vote against the Child Trust Fund?

  4. Isn’t it the shrinking band of middle class tax payers that take the burden of ever increasing government expenditure and bailouts?

    So, if anything is going to be “given back” (even if it is a naive and cynical gimmick), why the focus on the young and the poor who either don’t pay tax or receive lots of benefits paid for by those who do?

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