Osborne’s bank levy is still a damp squib

The Chancellor hasn’t lived up to his tough rhetoric in opposition.

Ahead of his first Commons bout with Ed Balls this afternoon, George Osborne has moved to shore up a weak flank for the Tories. The Chancellor has announced that the coalition's bank levy will be increased to £2.5bn this year, raising an extra £800m and allowing him to neutralise the charge that the Tories have handed a de facto tax cut to the banks.

Labour's 50 per cent tax on bonuses over £25,000 raised £3.5bn last year but this figure falls to £2.3bn if one assumes that the Treasury lost income tax due to the banks paying lower bonuses (NB: this remains a highly speculative assumption). As the FT's Jim Pickard suggests, Ed Miliband deserves much of the credit for Osborne's move. Had he not raised the issue at PMQs last month, it is unlikely the Treasury would have acted so swiftly.

But with the banks due to announce another round of bumper bonus payments this month, Osborne's announcement does little to bridge the gap between the Tories' tough rhetoric in opposition and their inaction in power. In 2009, Osborne called for a ban on bonuses at banks that had received any sort of government guarantee (including Barclays). He later promised to block all cash bonuses over £2,000.

Even the recent coalition agreement pledged to tackle "unacceptable bonuses in the financial services sector". But the government is set to tolerate a £9m payout to the Barclays head Bob Diamond (once accurately described by Peter Mandelson as "the unacceptable face of banking") and a £2.4m bonus to Stephen Hester, head of the 83 per cent state-owned RBS.

Meanwhile, the IMF, not renowned as a bastion of leftism, has urged Osborne to triple the bank levy to £6m. It calls for the G20 to impose a co-ordinated levy on the undertaxed banking sector to curb industry excesses and guard against "the future failures from which no country can regard itself as immune".

When even the IMF is calling for higher taxes on the banks, it's no wonder that the City is celebrating what it regards as another victory over the British state.

George Eaton is political editor of the New Statesman.

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Labour to strip "abusive" registered supporters of their vote in the leadership contest

The party is asking members to report intimidating behaviour - but is vague about what this entails. 

Labour already considered blocking social media users who describe others as "scab" and "scum" from applying to vote. Now it is asking members to report abuse directly - and the punishment is equally harsh. 

Registered and affiliated supporters will lose their vote if found to be engaging in abusive behaviour, while full members could be suspended. 

Labour general secretary Iain McNicol said: “The Labour Party should be the home of lively debate, of new ideas and of campaigns to change society.

“However, for a fair debate to take place, people must be able to air their views in an atmosphere of respect. They shouldn’t be shouted down, they shouldn’t be intimidated and they shouldn’t be abused, either in meetings or online.

“Put plainly, there is simply too much of it taking place and it needs to stop."

Anyone who comes across abusive behaviour is being encouraged to email validation@labour.org.uk.

Since the bulk of Labour MPs decided to oppose Labour leader Jeremy Corbyn, supporters of both camps have traded insults on social media and at constituency Labour party gatherings, leading the party to suspend most meetings until after the election. 

In a more ominous sign of intimidation, a brick was thrown through the window of Corbyn challenger Angela Eagle's constituency office. 

McNicol said condemning such "appalling" behaviour was meaningless unless backed up by action: “I want to be clear, if you are a member and you engage in abusive behaviour towards other members it will be investigated and you could be suspended while that investigation is carried out. 

“If you are a registered supporter or affiliated supporter and you engage in abusive behaviour you will not get a vote in this leadership election."

What does abusive behaviour actually mean?

The question many irate social media users will be asking is, what do you mean by abusive? 

A leaked report from Labour's National Executive Committee condemned the word "traitor" as well as "scum" and "scab". A Labour spokeswoman directed The Staggers to the Labour website's leadership election page, but this merely stated that "any racist, abusive or foul language or behaviour at meetings, on social media or in any other context" will be dealt with. 

But with emotions running high, and trust already so low between rival supporters, such vague language is going to provide little confidence in the election process.