Richard Murphy Profile picture
Sep 4, 2020 9 tweets 2 min read Read on X
Rishi Sunak’s gov’t backed loan schemes mean that more than 1.2 million U.K. businesses - which may be more than 80% of all businesses - are laden with debt and tax bills they have to start repaying next year. That’s when they begin to fail and the recession gets very much worse.
Piling debt burdens on companies to get them through a crisis is one thing. To then think they’ll invest in new employment, products or sustainability when struggling to repay that debt is another. They can’t and won’t. Sunak has built a debt time bomb that will drive recession.
The Office for Budget Responsibility has suggested £33bn of the £53bn of government backed loans to businesses may not be repaid. The gov’t says it expects banks to take failing companies to court to recover the money. They’re literally planning to drive the UK out of business.
The gov’t has a choice to make when it comes to recovering its coronavirus loans to business. It can seek to be repaid and destroy hundreds of thousands of companies, and many more jobs. Or it can convert the loans into shareholdings as the basis for a national wealth fund.
The UK has never had a national wealth fund - which could be the basis for a future National Wealth Service. Converting £53bn of government backed loans to business into shareholdings in the companies that borrowed to get through coronavirus could be the basis for that fund.
Of course no company should be forced to convert its gov’t loan into a shareholding. They should have the right to repay. But if they convert there must be conditions attached. They must publish their accounts, have an employee on the board, pay all their tax and be sustainable.
A National Wealth Service, running a national wealth fund, based on converting coronavirus loans into stakes in businesses could be the basis for the economic recovery the UK needs, and a transformation in the UK business model that is long overdue.
What’s better? A National Wealth Service dedicated to the recovery of UK business from the impact of coronavirus or a government that is planning to force banks to take companies to court to recover these loans when they can’t pay, which will force companies to go bust?
There’s only one business friendly approach to business recovery from the coronavirus crisis and it’s not the one the government is taking. We need a National Wealth Service to manage the stake the government’s now get in UK business for all our sakes, and we need it now.

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More from @RichardJMurphy

Sep 12
Keir Starmer will say the NHS must "reform or die" today. What he is really saying is that to balance Rachel Reeves' books, you might die because he's not willing to raise the funds to deliver the NHS this country needs. How does it feel to be a human sacrifice to austerity?
That, I think, summarises what Starmer will really be saying today.

He's refusing to provide the new money the NHS requires even though he knows, and will say, the Tories underfunded it.
Then he will claim he has no choice about that - which is completely untrue.

As a result, he is deliberately supporting the Tory plan, which was to collapse the NHS.
Read 11 tweets
Sep 2
Would the UK economy really have collapsed as Labour is saying if it had not cut the winter fuel allowance for most pensioners within days of coming into office, whilst announcing more more ‘pain’ to come? Of course it wouldn’t have done. A thread…..
Lucy Powell MP, Leader of the House of Commons, made the absurd claim that cutting winter fuel allowance saved the economy from collapse when taking on television on Sunday morning.
I suspect that she would have said the same of keeping the two child benefit cap in place. Together these policies saved maybe £4 billion. They reduced the well-being of more than 10 million low income people, many living in poverty.
Read 32 tweets
Aug 27
There is literally no need at all for Labour to deliver a painful budget in October. There is a massive capacity to increase taxes on wealth. If Labour wanted to borrow they could. And there are people who want good work.
So, the ‘pain’ is all about Starmer & Reeves’ choice to deliver hardcore neoliberal dogma and not meet people’s needs.
Starmer is worse than the Tories. They at least admitted to their pleasure at imposing austerity. He pretends he has no choice but do it when that’s completely untrue. He’s choosing to undertax wealth, under deliver services, and over deliver misery.
Read 6 tweets
Jul 21
Rachel Reeves told Laura Kuenssberg this morning that the pensions industry had failed the people of this country. Some obvious questions follow as a result. A short thread...
Why, if the pension industry has failed so badly, does she want to force people to pay more it in pension contributions, as seems to be her plan?
Why, if the pension industry has invested so badly for this country, does she think it will start doing better now if she gives it more money?
Read 9 tweets
May 23
The most useful thing I think I can do this morning is suggest questions to ask politicians in this election. A thread.
The following list builds on work referenced on my blog, and most especially the Taxing Wealth Report that I published recently. taxingwealth.uk
The list of questions is not necessarily in any order of priority. Themes are repeated quite deliberately because that is necessary when all politicians are evasive.
Read 19 tweets
Mar 1
Rishi Sunak is standing outside Downing Street saying that the newly chosen MP for Rochdale, elected yesterday, is the reason why he must crush our democratic freedoms. In the process he appeals to theocracy whilst totally undermining the democracy he claims to support.
The reality is that if there are extremists in the country it is those members of his party who want to create divisions in this country for their own small minded gains.
Worse, he appeals to our history as imperialist colonisers and deniers of freedom to billions to justify his position. If he wished to cause offence, that commentary is clearly intended to deliver it and is utterly blind to the prejudice created by economic and social division in our society,
Read 8 tweets

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