Tories plan to sell off RBS with a £20 billion loss as Labour demands public ownership
Labour has demanded that the government immediately halt the proposed RBS selloff, as it emerges the government will make a 40% loss on the shares.
The bank, which was bailed out to the tune of £45 billion in 2008, has been operated independently of the government, despite the fact that it is 70.5% in public ownership. The share price was around 500.2p per share in 2008, but is now languishing around 298p.
The bank has faced increased criticism after its plan to close branches across the country was contrasted with its tripling of profits earlier this year. In Scotland alone, almost 200 staff face redundancies, and rural account holders face the prospect of being unable to access their own money.
Labour has opposed the sell off on two grounds - firstly that the public is being swindled, and secondly that the bank should remain in public hands for the long term, to provide the type of investment the country desperately needs.
Responding to the news, Labour leader Jeremy Corbyn tweeted that:
“We bailed out RBS. It should be run in the interest of the public, not for private profit, and used to invest in small businesses and local economies across the UK.”
Shadow Chancellor John McDonnell hammered the point home:
“There is no economic justification for a further sell-off of RBS shares and it beggars belief that this government is considering selling shares at an even bigger loss to the taxpayer than the £1 billion George Osborne managed.
“All further sales of RBS shares should be halted, and the bank reorganised under public control to help provide the patient, long-term investment capital that businesses across the country so urgently need. The next Labour government will deliver a banking system that works for the many, not the few.”
An official announcement will come later this week.