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23.06.11

Proposal for public shares in banks

Deputy Prime Minister Nick Clegg has written a letter to Chancellor George Osborne, backing plans to give the public free shares in the Royal Bank of Scotland and the Lloyds Group, which were bailed out by the Government in 2008.

The proposal suggests 46 million people on the electoral roll would be given a sum of 1,900 shares in the two banks, which would be worth around £770 at the moment.

It is unlikely that many shares would be sold in the short term until bank prices have recovered, when taxpayers could benefit from long term gains.

Nick Clegg stated: “Psychologically it is immensely important that the British people feel they have not just been overlooked and ignored.

"Their money has been used to the tune of billions to keep the British banking system on a life-support machine and they have absolutely no say at all in what happens when normality is restored.

"I think, in a sense, as a society we are condemned to take an interest in our banking system."

After the Government invested about £65.8bn in 2008, the taxpayer currently owns 83% of RBS and 41% of Lloyds banks.

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