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The latest TUC press release - hope this isn't the wrong place for it to go.

TUC welcomes bank capitalisation but calls for tough conditions

Responding to the Government's purchase of shares in banks today (Monday), TUC General Secretary Brendan Barber said:

"This is a bold and welcome move. The Prime Minister and Chancellor may have had to dust down rusty and unused parts of their policy tool kit, but they have acted decisively and continued to show leadership at the global level.

"Securing the condition that banks will start lending again is the most important outcome today. This will reassure the many businesses where the credit freeze was beginning to threaten jobs and investment, and new mortgage lending will bring some relief to the housing market.

"But questions and challenges remain. In RBS at least, the Government is now the majority owner, and in other banks it will be by far the biggest shareholder. It now has major responsibilities as an owner that cannot be passed to an arms-length body. The lack of proper control by the owners of banks - shareholders and investment funds - has been a key cause of the crisis."

"The banks today have received as much cash as the annual defence budget. Tax payers will want to see big changes in return. It is not enough to limit cash boardroom bonuses for a year and accept a few ritual resignations. There cannot be big pay-offs for those who go, as was the case with Northern Rock. There needs to be a wholesale review of bonuses and pay throughout the upper levels of these banks, not just a year long ban on boardroom cash bonuses."

"The Government must stop the banks it owns using tax havens and other tax avoidance scams. It must also have a long term vision of how the UK banking sector should work. The banks have shown that they will act irresponsibly if allowed and there will be even less competition after enforced mergers. This will require a tough new regulatory regime."

"Let us hope that today's action represents a turning point in the crisis, but the Government must stand by to do more. It has shown that it can be bold when faced by a financial crisis, it must stand by for equally radical moves to help the rest of the economy."

by In Wales (inwales aaat eurotrib.com) on Mon Oct 13th, 2008 at 09:53:40 AM EST

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