STUC on Bank Profits

August 6th 2010

Commenting at the end of a week during which a number of UK banks announced large profits and new surveys confirmed rising house prices in Scotland, Grahame Smith, Scottish Trades Union Congress (STUC) General Secretary said:

“Two years on since the near collapse of Scotland’s major banks, the public are entitled to ask whether anything has really changed. The banks are back in profit thanks to the monumental state bailout, low interest rates and falling competition. Executives continue to extract massive pay and bonuses from a rigged labour market while ordinary bank workers suffer redundancy or rising workloads and employment insecurity.

“Across the economy, profits are growing while wages stagnate. House prices are rising again. There appears to be no political will to tackle the global imbalances that underpinned the financial crisis.

“Little meaningful regulatory or structural reform of the banks has been undertaken by this or the previous government. Coalition Ministers court ridicule by bemoaning the lack of lending by banks just after their emergency budget has stripped demand from the economy.

“With zero growth, rising unemployment and imminent spending cuts, a sustainable demand led recovery in Scotland appears to be as far away as at any point during the crisis. However, it looks increasingly likely that a new financial crisis is just around the corner. The reason is obvious: the abject failure of the politicians to undertake genuine economic reform after the worst financial crisis since the great depression.”


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