Cable: Government should consider bank nationalisation

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Cable: Government should consider bank nationalisation

Fri 27th Feb 2009

Vince Cable, the Liberal Democrats' shadow chancellor, has claimed that the government should consider nationalising some of the banks in which it already owns large stakes.

Mr Cable said that the government's current policies, which involve helping banks deal with debt but leaving them in the hands of private owners, amount to "nationalising the losses and privatising the profits".

He recommended that as well as helping banks to deal with toxic assets and debts, the government should buy normal shares with full voting rights, giving them more control over the direction banks take.

Mr Cable added: "At a time when even apostles of the free market such as Alan Greenspan are urging the Government to lose its fear of nationalisation, ministers still will not face reality.

"They must take responsibility for directly maintaining new lending to sound British businesses while curbing the bonus culture."

Recently, it emerged that Sir Fred Goodwin, who resigned as head of the Royal Bank of Scotland Group (RBS) in October, is claiming a pension of £650,000 per year.

RBS, which recently posted the largest ever loss made by a UK company, is 70 per cent owned by the taxpayer.

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