2018 Exercise Iris revealed | Sheku Bayoh sister says Floyd death "so similar" | Care staff testing row |
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07/02/2020 | View in browser
The UK corporate bailout you've never heard of

Do you know about the Covid Corporate Financing Facility? Well, don't beat yourself up if the answer's 'no', very few do. You'll find it scarcely reported in today's papers. In fact, the Bank of England at first wanted no one to know about - they sought to give out public money to corporations in complete secrecy, requiring participants to sign a confidentiality agreement. Thankfully, a campaign by Positive Money pressured them to reveal which UK companies are getting a bailout. The list makes for very interesting reading.

£300 million each goes to Brian Souters' Stagecoach, outsourcing giant G4S, and Rolls-Royce, which just announced it was laying off 9000 workers, including 700 at its Renfrewshire plant. Easyjet, which announced it was cutting 30 per cent of its staff last week, gets £600 million. The Intercontinental Hotels Group, which only yesterday announced it was starting a redundancy package at its hotels in Glasgow and Edinburgh, also gets £600 million. You get the picture. The only strings which are tied to this cheap money is a request by the BoE to be restrained in paying dividends. It doesn't matter if they are climate polluters or tax-haven users or have exposed their workers to harm during the pandemic, the BoE will bail them out if they are making a "material contribution" to the UK economy, just so long as they are also corporate giants.

So far, 152 companies have taken just over £16 billion from the scheme, with the BoE green-lighting £67.7 billion in total. The way it works is the BoE provides short-term liquidity based on the credit ratings of firms prior to 1 March, i.e. before the economy crashed. The money has to be paid back but attracts a minimal rate of interest, much smaller than these firms would get from commercial banks. CCFF is based not on a firm's future prospects, but on how big it was before the crisis (you have to be 'investment-grade' to apply). That's why the airliners, for example, have been first in line (£1.8 billion in bailout money combined): their prospects now look disastrous, but the CCFF stumps up cheap cash regardless. Indeed, the list of companies reads like a who's who of carbon polluters: one in five of the firms to receive the bailout money so far are airlines, oil & gas or car manufacturers. So much for claims from Ministers' that this would be a green economic recovery.

Not only is this money being dished out without social or ecological purpose, it provides a market advantage to company's purely based on their size pre-crash. For football fans out there, Man Utd and Tottenham are the only clubs eligible for CCFF (Tottenham has taken this up, with a £175 million loan), so if you are a supporter of another team, tough luck - they'll have to go to pay commercial rates if they need a loan. Meanwhile, five to ten clubs in the lower English leagues are on the verge of going under. This is not "free-market" capitalism - it is a corporate cartel.

Positive Money warns that many of these companies may be back for more before long as they burn through cash, with the BoE now having a direct stake in their survival. It is becoming absurd that this institution is 'independent' of government, i.e. of democratic accountability, when its influence on the UK economy is so massive and so skewed towards protecting the super-rich. Research on the impact of Quantitative Easing in the UK - another BoE corporate welfare scheme, which now totals £645 billion - shows it has had the effect of increasing wealth inequality.

The economy is rigged; Britain PLC wins even when they lose. And the role of the Bank of England in rigging the system is crucial.
Ben Wray, Source Direct
Top Story

The sister of Sheku Bayoh, Kadi Johnson, has said his death was "so similar" to that of George Floyd in Minneapolis, Unites States, which has sparked over a week of protests across the country and international solidarity.

Bayoh died in police custody in Kirkcaldy after being restrained by police in 2016, with an autopsy revealing 23 separate injuries. Officers used CS spray, leg restraints and batons in the arrest.

The officers involved denied wrong-doing and a Fatal Accident Inquiry last year decided not to prosecute. Bayoh’s death is now subject to a public inquiry.

Johnson said: "My children and nieces and nephews are angry. When they saw George Floyd’s video they were angry and hurt, remembering their uncle and how he died. Enough is enough."

Johnson has signed a letter also signed by human rights lawyer Aamer Anwar, Labour MSP Anas Sarwar and Justice Secretary Humza Yousaf, which calls for protests over justice for George Floyd in Scotland to be held digitally, due to the risks of spreading Covid-19. A Black Lives Matter protest in Edinburgh is set to go ahead on Sunday in Holyrood Park.

Anwar, the family’s lawyer, and Johnson also issued a separate statement, in which it stated: "The reality is that five days of civil unrest in the US has delivered more than five years of waiting for the Scottish criminal justice system to act - at least in the US, the family of George Floyd know police officers will stand trial for his murder, whereas in Scotland not a single officer was suspended, arrested or will ever face trial for Sheku."

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Other news

  • An exercise simulating a Coronavirus outbreak in Scotland in 2018 found a "clear gap" in preparedness. "Exercise Iris" simulated an outbreak of MERS, a novel Coronavirus with similarities to Covid-19, which revealed frontline staff "unease’ over the lack of PPE, calling for "substantive progress" on the matter. The Scottish Government has published a report about Exercise Iris after an FoI request. (BBC)
  • A growing row over the different speeds health boards are moving to test care home staff has led Health Secretary Jeane Freeman to demand that all health boards send her new detailed plans by 3pm today, saying there was no room for "local interpretation" in ensuring "testing commitments will be fulfilled". Opposition parties claimed Freeman was seeking to deflect blame after promising testing for care home staff without putting the resources in place. (The Herald)
  • 125 patients have caught Covid-19 while getting treatment in hospitals in non-Covid wards, a total which was described by Labour’s shadow Health Secretary as "worrying". 120 of the 125 cases have been "closed", meaning there is no evidence of new transmission in hospitals from them. (The Times)
  • Rural Economy secretary Fergus Ewing has been accused of "very un-ministerial" behaviour by civil service trade union PICS. Environmental campaigners say Ewing may have broken the Ministerial Code by failing to ensure 25 meetings with the fish farm industry were recorded, in what they believe is an attempt to evade FoI law. The Scottish Government said it was the responsibility of officials, not Ministers, to keep minutes. PCS offered a sharp rebuke to this, saying civil servants "fulfil what Ministers ask of them." (The Ferret)
  • Scottish Labour is planning to harden its opposition to a second independence referendum at an upcoming party summit, with a party source saying: "There will be no equivocation". The tougher line comes after the re-appointment of hard-line unionist Ian Murray MP as shadow Scottish Secretary, and the victory of Jackie Baillie MSP in the deputy leadership race. (Daily Record)
  • A University of Glasgow research paper has called for next year’s school exams to be scrapped, as the poverty-related attainment gap will have widened due to the impact of the lockdown on learning inequality. Barry Black also said that students from disadvantaged backgrounds should be given priority for returning to school, as well as to be offered summer school programmes and one-on-one tuition. (STV)
New on Source
Around and about the Scottish media
- Graeme Roy of the Fraser of Allander Institute looks at the economic woes facing Scotland (The Herald)

- George Kerevan on the new Brexit cod wars (Bella Caledonia)
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