Fair Budget? Banks get a boost and we get 'unavoidable' pain

Our employers will be taxed an extra 1% on our income not us. VAT does not cover everything 'we' buy, for the main it covers non-essential items. Maybe this will cause the wasters we have leaching from the hugely strained teet of the state to spend thier 'hard queued for' cash (or should I say our) on feeding thier children and clothing them rather than forking out for a new HD tele! Wishful thinking perhaps but non the less important to bring the many that dont pay tax of the income kind into the realm of generating some extra revenue....until we come to our sense andcut the beggers off! Perhaps if thier voting rights were reomved first. The monsterous Harriot The Harpy would stop trying to appeal to thier sense of imbacile!

The 'wasters' are a relatively small burden on the state, while the bankers and their legacy are large burdens. Sadly, many of the 'wasters' are British-born, and poorly educated. They have little to offer a modern economy. Poor skills in written and spoken English are common characteristics.

Anonymous 1 Our employers will be taxed an extra 1%

are you refering to NI INCREASE?if you are check your facts the 1% increase applies to EMPLOYEES not EMPLOYERS????????

The comment about the banks plundering our pension funds during the dot-com boom (and bust) is a little derisory when it is considered in the context of the real plundering of them carried out by the ex (ending boom and bust)Chancellor Brown in his first budget.

A little bias showing, perhaps?

Being a little confused by this continual bank-bashing I wonder if the author could use the HSBC bank in her example photo to explain to me just how much of "our" money this bank borrowed and what are the terms and interest rates of it's repayment..............

"Not only did they plunder our pensions when they talked up the tech bubble in the late 1990s but they also pushed up the cost of housing in the noughties by allowing people to write self-certification mortgages and to borrow 125% of the value of their homes."

Marvelous how the commentators always blame the banks and never the consumer. Banks did not force anybody to buy dot com company shares - if you invested in solid companies you would have been OK!

As for self certified and 125% mortgages, I thinks the liars and cheats that inflated their income should be the ones to blame here, not the banks. Why do we always ask somebody else to take responsibility for our actions? If you are reckless with your finances you should take the consequences and not try to blame the banks who were to help you in the firs place!

I have written before and often that the blame for the crisis lies with many people - not just banks - and that everyone needs to take responsibility for financial crises they find themselves in.

I stick to that.

My comment was that if a great number of people are all in some way responsible for the mess we're in shouldn't we all have been treated the same in the budget?

Why are the banks getting minimal penalties offset by tax cuts?

Why are they celebrating when we're worrying about how long interest rates will stay low, how we'll balance our household budgets in the years ahead?

Shouldn't the bank levy have been higher to compensate for the benefit from tax cuts? After all, surely corp tax reforms are meant to help wean Britain off our reliance on financial services?

And don't forget banks will benefit more than other more capital intensive businesses from other changes announced yesterday.

I don't doubt banks are essential and don't think bank bashing has always been justified.

I just don't think we should be told what is going on is 'fair' and 'unavoidable' when banks get a much greater say than the rest of us.

As for the dot.com boom, I was writing then too and the misinformation that was spread by analysts and the misuse of notice boards to talk up IPOs was as much to blame as gullible investors.

Bankers were talking up bad investments than just as they were in the last bubble when they sold assets knowing others were already waiting to short them.

They played the part in the good days and did well from it. They should share in the austerity now.

We can point the finger of blame at banks or individuals but ultimately the buck stops with the Government who encouraged banks to lend money to individuals who were not credit worthy.

For each person taken out of social housing or in expensive short term accommodation awaiting a permenant housing solution, this saved the Government thousands of pounds each year.

The more people that could be pushed into buying their own homes, the less the immediate drain on already over-stretched Government funding.

The banks carried out the Government's wishes - so we know whom to blame.

The overuse of the term "bank" is just confusing, be specific and use HSBC, the example illustrated, to demonstrate a typical bank's involvement with "our" money....

Re Ian Phillips comments.

Mr Phillips is right that some banks avoided the worst excesses, and HSBC was one such bank. Its track record with bank charges was also better than most. Other banks were truly awful, and Ms Hyde is entirely correct in her criticisms in regard to the majority of the big ones:

Abbey: really appalling - cannot even keep track of documents, and its complaint handling was/is atrocious.

RBS has some good branch managers (my own at Parbold, in West Lancs, is truly excellent) but it's record on acquisitions was terrible (why was Sir Fred Goodwin so keen to overpay for ABN Amro?)

Nat West (I know it is owned by RBS but it is run as a separate entity) - awful. Readers of Citywire may be unaware of the fact that all calls to Nat West Complaint Centres are recorded, and yet, if a complaint handler is apprised by the customer that he or she is also recording the call, the standing instruction to the officer is to terminate the call immediately. How's that for a level playing field?

HBOS plc Consider the culture that developed within HBOS plc. The head offices at "The Mound" in Scotland and in Leeds were places of fear. There was, without any doubt, a ruthless drive to sell product that led to the churning of endowments and the sale of worthless Payment Protection policies. Then massive over-reliance on the wholesale market for finance, so that the bank could lend inflated sums to self certification mortgagors who had exaggerated their earnings. This cost the HBOS Compliance Director, Peter Moore, his job when he tried to give some timely warnings. It was, he said: "Like trying to slow down an oil tanker with a towing boat". My submission would be that it was this culture that encouraged the really serious excesses exemplified by what occurred within the HBOS Reading Corporate lending office, where certain officers confused the role of banker with that of pirate.

We cannot let this happen again and yet most people are not really aware of how the majority of banks were operating before the crash. Most of us have got acquaintances who, like Mr Phillips, defend the banks because they have a good relationship with one bank (or even one bank manager) Ask yourself a simple question: " What bank, in its right mind, would seek to sell further credit cards to people who, self-evidently could not service their existing debt?

And yet every bank did this; the examples are legion.

Timothy Burton...........you have completely missed my point and having written at length on the actions of various high street branches you have used my name, again, totally out of context.....

No one in their right mind will ever love the banks or should ever trust them, certainly not in the matter of retail investment, one could easily regard them as a load of crooks. I recall the LloydsTSB Scottish Widows bond - or whatever it was called; it slips an aging brain - a product that promised excellent yield and seemed on the face of it - many don't read or understand the small print caveats - to guarantee the capital against loss as presented by their representative, but of course did not in fact. This was a bond based on techie shares which the bank did not own of course, and my wife lost a packet, which the Ombudsman deemed she could accomodate because I held investments in her name. It was a product that should never have been sold to the average retail investor; the initiated of course would not have bought it.

The banks have been primarily to blame for the credit fiasco by trading financial instruments, they at senior level don't understand, or care about for that matter, that has allowed borrowing to get completely out of hand. No the banks are not entirely to blame, general greed by all has contributed but the watchdogs - and there are many varieties - have been complicit, or too thick to understand what was happening, and probably not powerful enough to call things to order in any case.

I understand that banking is under review for some form of restructuring with an aim to separate the investment side from retail, which hopefully will prevent them using our deposits to make profits for themselves, but that still leaves the risks of all the general ineptitudes and deliberate contrivances they get up to.

I'm afraid making investments is a risky endeavour altogether and one learns the hard way to judge the marketplace; it is full of sharks and shysters; the same goes for borrowing. Ultimately, we as individuals have to make our own judgements very carefully - if you don't fully understand something on offer, don't take it.

Deborah, I should have added I agree with you gal; the banks should have been screwed til the pips began to squeak properly.

What was your point Mr Phillips? I thought it was a reproach to Ms Hyde for using HSBC (through the photo used) as a metaphor for "bad banks". You were right to point out that HSBC did not require bailing out and I agreed with you. I also emphasised that its charging policy was fairer than many other banks. The point I was making was that, absent the HSBC reference, Ms Hyde's remarks were fair and accurate in regard to many of the big banks, as were mine.

Timothy, sorry, Mr Burton......I was not reproaching the author for using HSBC as a metaphor for bad banks but for using the term "the banks" as though they were all bad. I simply used the photo she used as an example to encourage her to provide an explanation of the use of "our" money.....she has so far declined (surprise!).......as for "bad banks" they are not ones with bad "charging policies" or good or indifferent branch managers but in this case the ones using "our" money to bail them out.....and I certainly didn't "defend the banks because they (I) have a good relationship with one bank (or even one bank manager) "........I use my many bank accounts for profit with or without any form of relationship.

To the Editor.........you probably don't monitor these articles but just in case.....Citywire used to be a serious website with knowledgeable articles, that could be relied on, sent daily to members. Now they are endless drivel airing the limited views of Socialist students, whilst they provide amusement I suggest you take a good look at who your sponsers are...!

To the Editor...... I am not sure whether Mr Phillips is talking about me when he refers to the "...limited views of Socialist students...." though I suspect (from the contiguity of his last two posts) that he is. However, in raising the issue with your sponsors you may wish to point out that the column is being used by ordinary people (who are of course also taxpayers, mortgagors and bank customers) to offer their views on a matter of vital interest.

In my case I am very far from being a "socialist student". I am, in fact, a retired university law lecturer living in France. My contact with banks (in the sense under discussion) stemmed from being alerted to the fact that my wife and I had been the victim of "churning" by a major building society - the Halifax in fact. Churning is when a bank or building society adviser tells you that the mortgage endowment supporting your mortgage for the last 8 years is in fact "no good". They then sell you a brand new policy to replace it, on which they receive a fresh commission. Estimated loss some 25K.That a churn had been committed was confirmed in Financial Ombudsman Service proceedings and was (eventually) admitted by the Bank. Churning is a breach of FSA rules and has been described as "appalling advice" by experts such as Louise Hanson. Perhaps it's more than that. The FOS formula redress ignores many legitimate heads of loss, and it it took a county court law suit to recover our full losses.

The point is that many banks behaved very badly in the period 1988-2008. They all relished the fact that computerized administration systems allowed them to automatically rack up charges of between £20-£40 every time someone went a penny overdrawn. The products they sold were often downright inappropriate (eg Payment Protection Policies) and this is only now being evaluated by independent bodies. I am not an apologist for silly people who cannot manage their finances and seek to blame the banks, but there was/is no excuse for the blanket application of these charges, or the way in which credit was aggressively sold. Again HSBC was better than most.

Unless the British people remain angry at the various breaches of duty committed by banks (coupled with their stupidity in investments made abroad) change will not happen. The banks will win by default as everyone gets bored with the argument. As Ms Hyde has realized, the process of "business as usual" has already started.

Bankers are the true rulers of this country. Politicians always manage to feather their nests.

The rest of us are either doped out on buy-to-let and mortgage equity withdrawal - thus feeling like they're getting richer and richer - or are stuck in overpriced and under-regulated rented accommodation and too skint to buy into an objectively-observed overvalued property market.

Bankers and government are complicit in this scandal that is destroying the hopes and wealth of a generation... JUST LIKE JAPAN'S LOST DECADE.