Iceland could take local councils' money

[Snoopy]

http://news.bbc.co.uk/1/hi/uk_politics/7660438.stm

Many local authorities across the UK seem to have placed substantial sums with Icelandic Banks in the hopes of making a few extra £s. OK they claim this is investment to enable them to keep council taxes down but what was wrong with investing in British Banks, keeping the money at home where it belongs. At best they might have got an additional .5% interest but they are most surely not mandated to gamble with our money. They are legally charged to get the best value and best value has to include security of the funds. FFS they could have bought Savings Bonds from HM Government with a guaranteed return in absolute safety.
The truth is our elected councillors thought they were being smart, hiding from Government and us, the taxpayers, just how much spare wonga they had laying around. Well they have been caught out. Any councillor who has agreed with this practice should now be barred from public office.
Come on ~ you've all met some of your local council members and met the numpties they employ in their offices. Would you trust them to make a wise financial decision that wasn't directly related to their own pockets?

[Uncle Mort]

No.

[Nick]

Terror law used for Iceland deposits
By FT reporters

Published: October 8 2008 17:11 | Last updated: October 8 2008 22:54

Anti-terrorism powers were used on Wednesday to recoup money owed to UK depositors in a failed Icelandic bank in a move that risked sending Britain’s relations with Reykjavik to their lowest since the 1970s “cod wars”.

UK taxpayers are likely to pay out at least £2.4bn as part of a £4.6bn scheme to compensate hundreds of thousands of account holders at Landsbanki, the Icelandic lender, according to Whitehall sources.

Alistair Darling, chancellor, offered a blanket guarantee to UK retail depositors with money placed in Icesave, a failed internet bank owned by Landsbanki. But wholesale depositors in failed Icelandic banks – including dozens of local authorities and some universities – were offered no immediate support.

Some councils have lost sums of up to £40m, prompting the Local Government Association, which represents about 400 councils, to urge Mr Darling to extend protection to town halls.

The Conservatives said the black hole was a threat to services and could increase council tax bills. “Government needs to stop dithering and clear up this uncertainty,” said Eric Pickles, shadow local government secretary.

Gordon Brown unveiled “legal action against the Icelandic authorities” to recover depositors’ money, as the tone deteriorated to its lowest level since fishing and coastguard vessels clashed over cod stocks in the north Atlantic in 1976.

The chill came as Geir Haarde, Iceland’s prime minister, expressed disappointment at the refusal of western allies to help prop up the krona and said he had to find “new friends” in the form of Russia, which is considering a €4bn (£3bn) loan.

However, officials from both the UK and Iceland later said that relations were not as bad as the political rhetoric implied.

The Treasury expected Iceland’s depositor compensation scheme to cover about £2.2bn of the £4.6bn owed to about 300,000 Landsbanki depositors, with £1.4bn coming from the UK industry financial services compensation scheme and the remainder from the government.

Public cash would be needed to cover the industry share, the Treasury added, as the compensation scheme lacked sufficient money. It would try to recoup the taxpayers’ contribution later from the proceeds of the sale of Landsbanki’s estimated £7bn UK assets.

Treasury officials wanted to ensure wholesale creditors were treated “fairly”. But Mr Darling told MPs that local authorities – unlike individual depositors – were “informed investors”.

Lawyers said the Treasury’s unprecedented use of anti-terror powers to freeze Landsbanki’s estimated £4bn UK financial assets could create knock-on problems for other institutions with which the failed lender was doing business.

The freezing order was issued under the 2001 Anti-Terrorism, Crime and Security Act that was passed after the September 11 attacks the same year.

[Snoopy]

Yesterday's news ~ things have moved on since then ..... we may send a gunboat ~ if we can find one.

[Nick]

BANKS TO LEND YOU YOUR OWN MONEY     

THE government is to invest £500bn of your money in British banks so they can lend it back to you with interest.




The historic move is being hailed as a lifeline for the financial system as long as nobody asks too many questions.

Julian Cook, chief economist at Corbett and Barker, said: "The government will give your money to the banks so the banks can start lending you that money, probably at around 7% APR.

"Thanks to all the interest you're paying on your own money, the banks will make billions of pounds again and normality will be restored.

"After a few years of this the government will cash in the bank shares it bought with your money and use the profits to build a huge fucking dome somewhere."

He added: "In case you hadn't already worked it out - the entire global financial system is predicated on the assumption that you're an idiot."

Chancellor Alistair Darling said the decision had been taken in tandem with the banking industry, adding: "They used a lot of dirty words I'd never heard before and one of them had an angry looking dog."

Meanwhile, Emma Bradford, a sales manager from Bath, said: "Why doesn't the government just give my money to me so I can buy stuff from businesses who will then make a profit and put it in a bank?"


 

[Uncle Mort]

Not only that but the government has borrowed the mony to lend to the banks and you will have to pay the interest on that as well.

[Snoopy]

Perhaps we should return to barter as a system of commerce.

What can I do for you and what can you do for me in return? 

[Grumpmeister]

Yesterday's news ~ things have moved on since then ..... we may send a gunboat ~ if we can find one.

Darwin has a shotgun, so if we club together for a dingy would that count?

In answer to the earlier question about knowing a councillor who wasnt interested in his own benefits first, my uncle was a local councillor and had he honestly believed that moving the money to an overseas bank would have benefitted the taxpayer then yes he would have okayed it. Having said that if he had even the slightest doubt about it then he would have told whoever suggested it where to stick the idea.

[Snoopy]

Hard to know what to say to that. No slur intended against your uncle ~ some of my best friends etc ....... BUT
Many present day Councillors like most "National" politicians tend not to be of the brightest. I am always wary of anyone who actually wants to be a politician. Just having that as an ambition should be enough to disqualify anyone.

I can see their argument about seeking the best rates of interest but as anyone knows the higher the rate on offer the higher the risk. Basically they have gambled with our money and lost. It is not now up to the Government, as so many councillors seem to think, to rescue them from their own stupidity for the simple reason that the Government doesn't have any money of its own. It is merely the custodian of OUR money and they have already mortgaged the tax revenues for the next umpteen years.

Sorry but those that gave the go ahead for these "investments" should be barred from office and those that recommended that the councillors should invest our tax revenues with dodgy banks should be sacked for gross dereliction of duty and forfeit their gold plated pensions.

[Grumpmeister]

Many present day Councillors like most "National" politicians tend not to be of the brightest. I am always wary of anyone who actually wants to be a politician. Just having that as an ambition should be enough to disqualify anyone.

No problem Snoop but I think you have the answer there, my uncle was an 'old school' councillor. I've seen some local councillors down here fight tooth an nail against out of town supermarkets because they had little corner shops and were afraid of losing revenue themselves.

[Pastis]

I note my council's not on the list, yet. They're probably overdrawn instead.
Look your's up:
http://news.bbc.co.uk/1/hi/uk/7660741.stm

TFL (transport für london) on the other hand has £40M under threat in Iceland 

Meanwhile I've just had a major hit this morning. New business contract for next year has just been dropped as the owners of the company have decided to dismantle the venture.  It was all going so well ...

[Grumpmeister]

How the hell did Cornwall County Council manage to put money in there. Its only us emmits in these parts that know you dont fall off the edge of the sea when you reach the horizon? 

[Snoopy]

How the hell did Cornwall County Council manage to put money in there. Its only us emmits in these parts that know you dont fall off the edge of the sea when you reach the horizon? 

You sure?

[Grumpmeister]

That only us emmits know or that we won't fall off when we reach the horizon? I'm not sure if the Welsh are further ahead than the Cornish in that respect 

[Snoopy]

The "Full" list of councils and other "Authorities" with money tied up in just one Icelandic bank.

Here are the councils who have so far revealed deposits in the collapsed Icelandic bank Landsbanki or its UK arm Heritable, or in other threatened Icelandic institutions:

    * Kent County Council - £50 million
    * Nottingham City Council - £42 million
    * Norfolk County Council - £32.5 million
    * Dorset County Council - £28.1 million
    * Hertfordshire - £28 million
    * Barnet Council- £27 million
    * Somerset County Council - £25 million
    * Northumberland County Council - £23 million
    * Surrey County Council - £20 million
    * Hillingdon Council - £20 million
    * Neath Port Talbot Council - £20 million
    * Westminster Council - £17 million
    * Brent - £15 million
    * Caerphilly County Council - £15 million.
    * North Ayrshire - £15 million
    * Plymouth City Council £13 million
    * Havering Council - £12.5 million
    * West Sussex - £12.9 million
    * Breckland Council - £12 million
    * Gloucestershire County Council - £12 million
    * Cheltenham Borough Council - £11 million
    * Lancashire County Council - £10 million
    * Scottish Borders Council - £10m
    * Cambridge City Council - £9 million
    * Wakefield - £9 million
    * West Oxfordshire District Council - £9 million
    * Wyre Forest District Council - £9 million
    * Cheshire County Council - £8.5 million
    * Bassetlaw District Council - £8 million
    * Bristol City Council - £8 million
    * Daventry District Council - £8 million
    * Wiltshire County Council - £8 million
    * South Lanarkshire Council - £7.5 million
    * Derwentside District Council - £7 million
    * North East Lincolnshire Council - £7 million
    * West Lindsey District Council - £7 million
    * Cherwell District Council - £6.5 million
    * Redcar and Cleveland Council - £6 million
    * Lancaster City Council - £6 million
    * Canterbury City Council - £6 million
    * Ceredigion - £5.5 million
    * North Lincolnshire Council - £ 5.5 million
    * Sutton Council - £5.5 million
    * Bracknell Forest - £5 million
    * Bromley Borough Council - £5 million
    * Buckinghamshire County Council - £5 million
    * Stoke-on-Trent Council - £5 million
    * Braintree District - £5 million
    * Cornwall County Council - £5 million
    * Exeter City Council - £5 million
    * Ipswich Borough Council - £5 million
    * Oxfordshire County Council - £5 million
    * South Ayrshire - £5 million
    * South Ribble - £5 million
    * Wokingham Borough Council - £5 million
    * Gateshead Council - £4.5 million
    * Oxford City Council - £4.5 million
    * Colchester Borough Council - £4 million
    * East Lindsey District Council - £4 million
    * East Staffordshire Borough Council - £4 million
    * North Wiltshire District Council - £4 million
    * Powys Council £4 million
    * Restormel Borough Council - £4 million
    * Rotherham Council - £3.8 million
    * Flintshire Council - £3.7 million
    * Aylesbury District Council - £3 million
    * East Ayrshire - £3 million
    * North Somerset - £3 million
    * Doncaster Council - £3 million
    * Nuneaton and Bedworth - £3 million
    * Peterborough City Council - £3 million
    * Rhondda Cynon Taff Council - £3 million
    * Solihull Council - £3 million
    * Stroud - £3 million
    * Slough Council - £2.5 million
    * South Oxfordshire District Council - £2.5 million
    * Wycombe District Council - £2.5 million
    * Cotswold District Council - £2 million
    * Gloucester City Council - £2 million
    * Great Yarmouth - £2 million
    * Moray Council - £2 million
    * Newark and Sherwood District Council - £2 million
    * South Hams District Council - £1.25 million
    * Monmouthshire Council - £1.2 million
    * Mid-Devon - £1.1 million
    * Charnwood Borough Council - £1 million
    * Dover District Council - £1 million
    * Bridgend Council - £1 million
    * Bridgnorth - £1 million
    * Hertsmere Borough Council - £1 million
    * Kirklees Council - £1 million
    * Perth and Kinross Council - £1 million
    * Tewkesbury Borough Council - £1 million
    * Vale of White Horse District Council - £1 million
    * Winchester - £1 million
    * Sevenoaks District Council - £1 million
    * Tonbridge and Malling Borough Council - £1 million
    * Lewes District Council - £1 million
    * Burnley Council - TBC
    * Chorley Council - TBC
    * Wychavon District Council - TBC

Other affected bodies

    * Transport For London - £40 million
    * Metropolitan Police - £30 million
    * Dorset Police Authority - £7 million
    * Sussex Police Authority - £6.8 million
    * West Yorkshire Police Authority - £6 million
    * Northumbria Police Authority - £3.5 million
    * Hertfordshire Police Authority - £3 million
    * Gwent Police Authority - £1 million

I assume TBC (To be confirmed) means they don't actually know how much they have salted away.