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The Argument Against A National Wealth Service

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There is, out there, the slightest parp of the idea that we should have a National Wealth Service. The idea being that all those businesses have taken loans from the government to aid them through the coronavirus. Also, that those businesses will not be able to pay those loans back. So, either bankrupt some large portion of the economy or convert the debt to equity. Thus leaving the government owning large chunks of the economy.

The conversion to equity isn’t in fact a problem and why not? It’s the other stuff that comes with it. The insistence that along with the conversion comes the promise not to avoid tax, to appointing at least one worker director, to close the wage gap, publishing the gender equality plan and – well, you get the picture. Along with the equity conversion comes the implementation of every right on, woke and progressive plan. These all being costs and not notably adding to the lifespan of a company. As we can see:

British Gas has acquired Robin Hood Energy, the failing council-owned energy supplier whose clients include former Labour leader Jeremy Corbyn.
The company, which has fallen into heavy debt, has made more than 250 employees redundant as a result, company sources say.
Staff were told this afternoon that they no longer had jobs.
Robin Hood’s 112,000 residential customers and 2,600 business clients will transfer to British Gas over the next few months after the deal closes on Sept 16. British Gas owner Centrica did not disclose how much it was paying for the company.

This is the council owned one run in woke fashion:

The firm was launched by Nottingham City Council in 2015 but fell into financial difficulty last year.
The council was forced to write off loans worth more than £24m after the supplier failed to make money.

Oh, right. Well, anyone can make a mistake, right? One swallow doth not a winter make and all that. Except:

Meanwhile staff at fellow council-owned Bristol Energy have been told that the business intends to sell its domestic customer accounts after falling into financial trouble, a company source said.
Bristol City Council has injected £35m into the struggling business since 2015. Earlier this month, the company said that it had sold its 4,000 business customer accounts to supplier Yü Energy for £1.3m.

Ah, it appears that right on and woke is not the way to run a business then.

And now to point out what this real demand about a National Wealth Service is. Your money – those loans you’ve made as a taxpayer – is to be used to run these companies the way they want. A proposal to which the correct answer is “sod off” of course. Along with an injunction to use their own money to run things as they want.

If you wish a company to be run in woke fashion then off you go, go start one. The joy of this system being that if woke doesn’t mean go broke then other people will copy you. Because that’s what capitalists do, take the easy path to making profits. If being nice to the non-gammons that work there works then all will be so nice. All you’ve got to do is prove it. The insistence as it is currently, that all extant businesses must so change, does leave open that possibility that woke does mean broke….

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4 COMMENTS

  1. Like many ‘pie in the sky’ ideas it seems reasonable until looked at in detail. Some have advocated that along with the shareholding, the governments gets a seat on the board of all these companies. So where are the army of tens of thousands of business-minded civil servants that would be needed? Companies I advise are currently able to arrange board meetings at short notice, implement equity based employee incentive schemes and investment when needed. Shareholder resolutions, pre-emption waivers and the like can be organised when and as soon as needed.

    Can you imagine some government ministry being as flexible? Can you imagine anyone wanting to buy a company shackled with these restraints?

    • That’s just one of the problems (idiocies). Worker directors fine – as long as they really are workers not Trade union officials, not avoiding tax (do they really mean that? – I pay all tax that is due but HMRC choose to exempt Gift Aid and refund tax on my pension contributions), publish gender equality plan: no way! – that means asking women to work the same hours as men which is totally unacceptable..

  2. Is there a list of all council loans and investments into businesses, and a report on the performance of those loans/investments?

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