As a country we have bought a very expensive bank! What should we do with it? Bail it out and then turn it over to the private bankers again? No. Let’s USE IT.
Conversely, for us as a country there is a lot of money to be SAVED here! How? well How about this for an idea:
We know that banks make money by charging the businesses that accept your payments, whether by card or cash. Why do we allow them to make money on all the benefits, tax credits and unemployment money we pay out?
If there are say 1,500,000 people receiving benefits why is that we allow chunks to be taken out of this by private banks? Lets work it through:
1,500,000 people who receive for the sake of argument, £100.00 each week. This money is deposited automatically by the Government into peoples bank accounts. At my low estimate that is 150 Million pounds ( £150,000,000 ) per week or 7.8 Billion (£7,800,000,000) a year being deposited that gets under the control of commercial banks, and we know what they do with it. Plus many of the people receiving benefit are on the borderline between credit and debit most of the time. They will probably be incurring interest on overdrafts and charges when, in desperation or panic, they make payments that they can’t afford. And I expect the banks are charging us, via the government for paying all the amounts each week. Lets say it is just 10p per transfer or payment that would amount to £7,800,000 per year just for making the payments!
I believe that we can use Northern Rock (Our New “Civic Bank”) to massively reduce the costs to society of the administration of the benefit system and help us to control the money we using to support those in need. If we use Northern Rock as the “Civic face” of the Bank of England (effectively what it is now) we can benefit in the following ways:
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By issuing a “civic debit card” we bring the benefits system in to the 21st Century.
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By issuing a “civic debit card” to people receiving benefits instead of hard cash or transfers to commercial banks we reduce costs.
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Reduced and easier access to “emergency money” by people in short term money trouble.
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This emergency money to be Interest free.
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The ability to recover the short term emergency money loans by automatically debiting a weekly amount (that is agreed to be affordable) to the persons civic debit card account.
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Reduced cost for the applicants - no need to travel to make an enquiry – can be done by phone.
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Reduced interest paid by credit-borderline people.
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No charges on accounts for credit-borderline people.
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Reduced expense for the country by keeping these charges down (after all we probably end up paying them)
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Reduced benefit fraud – the civic bank will know how and where the money is being spent so unusual or strange spending will be investigated. (The credit card companies and banks already do this.)
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Proper realistic interest rates paid on money kept in the civic card account encouraging saving.
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Reduced fraud in applications for benefit and distribution.
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Less threat to DHSS staff – there is no actual cash on the premises.
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Having the cards will carry no stigma.
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No other bank account necessary to hold a civic debit card.
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Limited Cash withdrawal so benefit spending can be tracked.
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Options for unwell and/or addicted people on benefits to restrict their card voluntarily for instance so they cannot buy alcohol or cigarettes.
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Particular people could benefit from a different form of card – a “Civic Pride Card” these would be issued to people who have given or lost something or someone for the benefit of our society or it aims. Particular instances come to mind:
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The remaining partner of a member of the armed forces killed in combat
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The remaining partner of a member of the police service killed in the line of duty.
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People elected by the Queen or the People to receive a Civic Pride card.
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Injured and disabled services personnel themselves injured in the line of duty.
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Civic Pride cards are a lifelong entitlement to an agreed and indexed sum per year or month– the recipients’ service being considered “beyond price”. We should not quibble or be reticent about honouring those who give so much.
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The civic bank will cover its costs by investing the unspent money in the civic card accounts – it can do this profitably and competitively because the money source will be cost-free. It will not be permitted to lend money it has not got – no leveraging/gambling with the country’s assets!
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The civic bank will cover its costs by participating in the current per transaction card charging scheme.
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Reduced cost of living by negotiating with large regional supermarkets for the best discount for food and essential goods charged to the civic card.
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Accessibility – Northern Rock to take over the existing Post Office network scheduled for closure. Providing those vital services where they are needed – not where commercial banks think they would be most profitable.
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Could double as an ID card – covering the costs of the ID card scheme using commercial practices.
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Civic cards for pensioners. More transaction coats saved and as pensioners tend to be better savers, more deposits for the civic bank.
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Civic cards available to all not just those on benefits.
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“Untied” cards available for asylum seekers and refugees. With a limited life span. (3 Month temporary permit? 3 month civic card.) With use restricted to essential purchases. To extend it or receive a new one we want to know where you are and what you are doing.
The uses for such a system go on and on. The possibilities are almost endless once such a card was established and in use.
There will be fraud of course, but there always will be, no matter what the system.