23 Mar 2011

A budget for bankers

Caroline Lucas today branded the Chancellor's statement "a budget for bankers," saying it put the interests of international finance and big business above those of ordinary people or the environment.

"George Osborne has made cutting the deficit his one and only goal. This may please City bankers and international investors, but it means more unemployment, greater poverty, and decimated public services.

"It is also a huge missed opportunity to turn our environmental and energy crisis into an engine for a sustainable future. Investing in energy efficiency and renewables now would stabilise the economy, help people reduce their bills, help end fuel poverty and make us less dependent on oil and gas from overseas.

"Instead, the Government is cutting support for UK companies trying to lead this energy revolution, even though it has found £5 billion in tax cuts for biggest companies.(1)

"It has also turned the much-hyped Green Investment Bank into a PR stunt by preventing it from raising funds." (2)

The Green Party's alternative budget called for:

• support for the development of a sustainable economy in place of unsustainable growth,

• a crack-down on tax evasion and avoidance, with banks and corporations paying their full share,

• the extra revenue used to support public services, in place of cuts.

Caroline Lucas continued: "The Government's budget plans are not the only option, despite Osborne's claims. A combination of intelligent investment and reduced tax avoidance could have provided financial stability and also avoided job losses and service cuts. He and his Conservative and Liberal Democrat colleagues have instead chosen to follow the bankers' agenda of cutting public services as deeply as possible while privatizing what is left.

"The Chancellor says there is no money to protect services such as schools, libraries and hospitals. But he can find the £3 billion it will cost to break up the NHS ready for privatization (3) or the £3.6 billion in extra subsidy for the nuclear industry. (4)

"Further, the Office of Budget Responsibility has predicted that the borrowing requirement this year will be £2.5 billion less than expected. (5)

"But instead of using at least a proportion of this to avoid some of the worst of the planned cuts, he is holding it back - presumably to fund tax cuts ahead of the next election.


1) The Treasury's own projections are that the reductions in Corporation Tax announced in the June 2010 and today's budgets will reach £5.175 billion a year by 2015/16. See pages 42 and 44 of the Red Book.

2) The Green Investment Bank will not be able to raise funds until 2015 and then only if other fiscal targets are met: Red Book 1.112 (page 33)

3) Professor Walsh in the British Medical Journal: July 2010

4) £3.43 billion is the estimated windfall gain for the UK nuclear industry from the introduction of a carbon floor price: source WWF

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