Money madness

Chancellor Jeremy Hunt’s autumn budget shows that the Tories are determined to punish anyone not in the top 10 per cent of wealth while crushing the majority of people – the poorest will suffer a 20 per cent drop in income.

The biggest winners in this grotesque wealth transfer from the poorest to the richest are the UK commercial banks. Not only has the Tory government lifted the cap on bankers’ bonuses and reduced the tax banks pay, it will be paying £136 billion in interest over the next five years to the banks. This is money the government gave the banks using Quantitative Easing (QE), which is creating money without incurring any debt. That’s £27bn a year that could be used to fund the NHS and education and equals the spending cuts and the increased tax Hunt imposed last week.

How did this happen? The government created nearly £900bn of new money through QE, which was spent into the economy via the commercial banks. The banks put this money on deposit account with the Bank of England, where they are paid interest on money they were given. Interest rates are rising and are expected to hit 5 per cent, meaning banks will reap an extra £155bn over the next five years they did absolutely nothing to earn.

Austerity isn’t needed and will result in horrific longterm harm to the country. Labour seems willing to follow this Tory madness. This union is doing nothing for Scotland. We must end it. LEAH GUNN BARRETT

Edinburgh