In a move that might lift the spirits of cash-strapped Britons before the next general election, the government is considering giving away its stake in state-controlled Royal Bank of Scotland PLC by 2015, newspapers reported on Friday.
The government owns 82 per cent of RBS after rescuing the bank by pumping in £45-billion ($70-billion U.S.) of capital when it neared collapse in 2008.
In October the bank said it was preparing to sell the shares in 2014, one year before the next general election, with the timing and sale structure up to the government. No share giveaway was mentioned.
“Plans to sell off or even ‘give away’ the government’s majority stake in Royal Bank of Scotland before the next election are being drawn up by (finance minister) George Osborne’s Treasury,” Britain’s Independent newspaper said in an advance copy of its Saturday front page, which gave no sourcing details.
Citing unnamed “Treasury sources,” the Daily Mail said the plan is being explored by Economic Secretary to the Treasury Sajid Javid, and could involve giving shares away next year or selling the shares to the public at a discount.
“Wouldn’t it be much better if voters were getting a cheque for 400 pounds a few months before election day? It would also be a very big stimulus,” the newspaper quoted one Conservative source as saying.
RBS and UK Financial Investments, which looks after the government’s stake in the bank, declined to comment. The Treasury was not immediately available for comment.
Deputy Prime Minister Nick Clegg in 2011 backed proposals to give the public shares in part-nationalized banks because taxpayer money had been used to keep the banking system alive.
At the time, the Treasury said it would “look at all options,” but critics dismissed the idea as a headline-grabbing exercise.