Lloyds Banking Group CEO Charlie Nunn said banks help support borrowing and investment and local leaders can move projects forward, according to The Independent, as the U.K. approaches its Oct. 28 Budget.
The Independent reported Monday that Nunn made those remarks in an interview with Financial Times journalist Patrick Jenkins. He argued that governments should prioritize economic growth and warned against an additional tax on banks, saying it could weaken lenders’ support for borrowing and investment.
Before the Budget, The Independent reported that banks were among sectors discussed as possible tax targets. Tax and audit firm Blick Rothenberg told the outlet that banks could face a heavier combined bill if another charge were added, because corporation tax was lower when banks last faced a windfall tax.
Debate over the levy also concerns who receives profits and where lenders invest. The Independent noted that bank profits can reach investors, other businesses and financial firms, which employ many people. Banks allocate capital according to expected returns, the outlet said, so an added U.K. cost could make other markets more attractive. The effect could be greater for international lenders such as Barclays and HSBC than for more domestic lenders such as Lloyds and NatWest.
Nunn also backed devolution as a way to get projects moving. At the local level, he said combined authorities and mayors could connect land, businesses and universities. Referring to his earlier decade at HSBC and work with governments across 50 countries, Nunn described productivity as a recurring focus abroad. He argued Britain had put less emphasis on that approach since the financial crisis.
Burnham has asked the Scottish Government to help shape a regional plan that could include employment support; no transfer has been agreed, as EconoTimes previously reported on the proposal. The government is scheduled to present its Budget on Oct. 28.
