London, 24th October 2023 – In response to Barclays announcement this morning that its pre-tax profits for the third quarter of 2023 were £1.9 billion, taking its profits for 2023 so far to £6.5 billion, Fran Boait, co-executive director of Positive Money said:
“These profits are the product of suffering: the high interest rates they’re derived from have flooded food banks with new users as families are forced to divert more income to high housing costs.
“Barclays have cut services across the country, closing almost 200 branches this year, meaning that not only are these bumper profits unjust, they’re also totally undeserved.
“If the government is serious about quashing inequality, it will use this year’s Autumn Statement to place a windfall tax on boosted bank profits, instead of handing them tax cuts like it did in last year’s.”
Reacting to news later in the day confirming that the government would be scrapping the cap on bankers’ bonuses, which currently limits bonus payments to twice bankers’ salaries, Fran Boait added:
“While record levels of families and children are pushed into poverty, politicians are brazenly pushing ahead with plans to allow bankers make uncapped millions year on year.
“From the 2008 crash to more recent crises, we’ve seen how the financial sector treats our economy like a casino, sucking up wealth to gamble with and punishing us all when it loses.
“The cap on bonuses is designed to keep this risk-taking in check, and this announcement reflects yet another risky move in the government’s prioritisation of financial sector ‘competitiveness’ above public wellbeing.”
- Barclays Q3 profit announcement can be found here: https://home.barclays/investor-relations/reports-and-events/financial-results/
- Higher interest rates mean that the Bank of England is expected to pay an estimated £75bn of interest on banks’ risk free reserves over 2023 and 2024, with a total of around £150bn due to be paid out between 2022 and 2028. For more information see: http://positivemoney.org/wp-content/uploads/Bank-windfall-tax-briefing-2.pdf
- Positive Money is petitioning for this windfall to be taxed: https://actionnetwork.org/petitions/tell-hunt-to-tax-the-banks/
- Calls for a windfall tax on banks have been echoed by MPs, including Angela Eagle, John McDonnell, Clive Lewis, Diane Abbott and Richard Burgon
- Polling commissioned by Positive Money found the majority of the public supports a windfall tax on banks: https://positivemoney.org/2023/09/uk-public-support-windfall-tax-on-banks-polling-shows/
- Barclays has cut 180 branches in 2023: https://www.which.co.uk/news/article/barclays-bank-branch-closures-in-2023-akhJO3I4TLk1
Positive Money campaigns for a money and banking system which supports a fair, democratic and sustainable economy. Set up in the aftermath of the financial crisis, Positive Money is a not-for-profit company funded by charitable trusts and foundations, as well as small donations from its network of over 65,000 supporters. www.positivemoney.org