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Chase Bank Limits Cash Withdrawals, Bans International... Before you read this report, remember to sign up to http://pennystockpaycheck.com for 100% free stock alerts Chase Bank has moved to limit cash withdrawals while banning business customers from sending...

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Richemont chairman Johann Rupert to take 'grey gap... Billionaire 62-year-old to take 12 months off from Cartier and Montblanc luxury goods groupRichemont's chairman and founder Johann Rupert is to take a year off from September, leaving management of the...

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Cambodia: aftermath of fatal shoe factory collapse... Workers clear rubble following the collapse of a shoe factory in Kampong Speu, Cambodia, on Thursday

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Spate of recent shock departures by 50-something CEOs While the rising financial rewards of running a modern multinational have been well publicised, executive recruiters say the pressures of the job have also been ratcheted upOn approaching his 60th birthday...

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UK Uncut loses legal challenge over Goldman Sachs tax... While judge agreed the deal was 'not a glorious episode in the history of the Revenue', he ruled it was not unlawfulCampaign group UK Uncut Legal Action has lost its high court challenge over the legality...

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Private members’ ballot: Politics live blog

Category : Business

Andrew Sparrow‘s rolling coverage of all the day’s political developments as they happen, including the private members’ ballot and Google giving evidence about tax avoidance to the public accounts committee

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TUC warns of ‘lost decade’ as IMF arrives to scrutinise UK economy

Category : Business

Officials to investigate economic outlook as unions argue austerity policies are causing UK to lag behind in global recovery

International Monetary Fund officials arrive in London today for their annual health check of Britain’s economy as the government faces a fresh warning its austerity drive is causing a “lost decade of growth”.

Echoing the IMF’s recent warning that George Osborne, the chancellor, needed to ease up on austerity cuts in the face of a stagnant economy, the Trades Union Congress (TUC) has argued that the UK is being left behind in the global recovery.

It said the UK is experiencing a slower economic recovery than 23 of the 33 advanced economies monitored by the IMF. The TUC report, issued to coincide with the arrival of the IMF mission, also claims the vast majority of eurozone countries are performing better.

TUC general secretary Frances O’Grady said: “We truly are experiencing a lost decade for growth. While other countries are already seeing a rise in economic output, the UK won’t return to its pre-crash level for another four years.

“The chancellor’s commitment to self-defeating austerity has prolonged people’s suffering and put the brakes on our economic recovery – so much so that escaping a triple-recession is considered by some to be a cause for celebration. Even George Osborne’s favourite economic institution, the IMF, is calling on him to change course.”

Looking at income per head, the TUC warned the UK would not return to its pre-crash level until 2017. By contrast, income per head in Germany and the US would be more than 10% higher a decade on from the financial crisis.

The TUC said the figures, based on the IMF’s latest GDP forecasts, also revealed how the UK is emerging from recession at a slower rate than at any time in recent history. The report says: “In 1985, UK income per head was 6% higher than it was before the 1980 crash. In 1995, UK income per head was 7% higher than it was before the 1990 recession. UK income per head is today still 6% below its 2008 level.”

Over the next two weeks IMF officials will be gathering information on the UK’s economic prospects from the Treasury, Bank of England, private sector economists, trade union officials and the government’s independent forecaster, the Office for Budget Responsibility. The IMF deputy managing director, David Lipton, is then expected to hold a news conference on or around 22 May at the end of the discussions.

IMF officials caused embarrassment for Osborne last month when, alarmed at the flatlining of the British economy in 2011 and 2012, they urged him to do more to boost growth and to rethink plans to cut the structural budget deficit by 1% of national income in 2013-14.

The Washington-based organisation was initially a strong supporter of the coalition’s approach to tackling the UK’s record peacetime budget deficit. But its chief economist, Olivier Blanchard, singled out the UK as a country that had the scope to ease fiscal policy to boost growth. Osborne was particularly irritated by Blanchard’s comment that the UK was “playing with fire” by refusing to change tack.

Osborne, however, will stand firm at meetings with the IMF delegation. Treasury officials intend to show that any change to the strategy they have followed for the last three years would damage the government’s credibility in the financial markets and the subsequent increase in long-term interest rates would outweigh any benefits from cutting taxes or increasing spending.

The Treasury will say that the economy is gradually on the mend and that the IMF’s anxiety about the weakness of growth has already been addressed in recent policy initiatives. They will also say that the sluggishness of the economy in 2012 was a result of the drop in exports to the crisis-hit eurozone, rather than weak consumer spending.

The TUC argues that many eurozone economies, including France, Germany, Ireland and the Netherlands, are recovering faster in GDP per head terms and so Osborne “cannot blame Europe for the UK’s economic woes”. It wants the chancellor to ease off on austerity and focus more on jobs and spurs to growth and confidence such as an extensive house building programme.

“He should start learning from countries like the US whose ambitious programme of investment in jobs is helping to turn its economy around,” said O’Grady.

A Treasury spokesperson said: “This is an own goal by Labour’s paymasters. This analysis starts in 2008 and so includes the biggest recession in modern history – which happened under Labour. Clearing up the mess we inherited won’t happen overnight.”

Chris Leslie, shadow financial secretary to the Treasury, said: “George Osborne should not arrogantly dismiss the advice of hte IMF team flying into London this week. It is time the chancellor listened to their warnings that his failing economic poilicies are plahing with fire and that Britian now needs a plan ‘B for jobs and growth.”

The IMF cut its forecast for UK growth in both 2013 and 2014 last month. Its publication – the half-yearly World Economic Outlook – said GDP would rise by 0 .7% this year and by 1.5% in 2014 – in both cases a cut of 0.3 points from its last set of predictions in January.

Arts and culture worth more than £850m to UK export trade

Category : Business

Report shows arts budget of less than 0.1% of public spending delivers four times that in contribution to GDP

Arts and culture delivers a significant return on relatively small levels of government spending and directly leads to at least £856m of spending by tourists in the UK, according to a new report seeking to analyse the value of the arts to the modern economy.

Analysis by the Centre for Economics and Business Research (CEBR) shows that the arts budget accounts for less than 0.1% of public spending, yet it makes up 0.4% of the nation’s GDP.

The report is published amid fears that the arts will take another big hit when George Osborne announces his spending review in June.

Maria Miller, the culture secretary, recently called for the economic case to be made for the arts, “to hammer home the value of culture to our economy”. She added: “In an age of austerity, when times are tough and money is tight, our focus must be on culture’s economic impact.”

The report, commissioned in November, helps to do that in unprecedented detail, showing that spending on the arts is far from a drain on public resources.

Alan Davey, chief executive of Arts Council England, which commissioned the research with the National Museum Directors’ Council, said he was gratified that the report quantified “what we have long understood – that culture plays a vital part in attracting tourism to the tune of £856m a year; that arts centres and activities transform our towns and cities and drive regeneration, making the choice to maintain investment in culture a forward thinking one for local authorities; and that the arts support the creative industries and improve their productivity.”

The report calculates that:

• The turnover of businesses in the arts and culture industry was £12.4bn in 2011. This in turn led to an estimated £5.9bn of gross value added (GVA) to the UK economy in the same year. (GVA is the value of the industry’s output minus the value of inputs used to produce it, including state subsidies.)

• The sector provides more than 110,000 jobs directly, about 0.45% of total employment in the UK. The figure becomes 260,300 jobs once the indirect impacts of arts and culture are added in.

• Living in an area with twice the average level of cultural density adds an average £26,817 to the value of a property.

The report says that public subsidy plays a vital role in encouraging creative innovation by “overcoming private-sector reluctance to invest in risky projects”. One example of that, quoted in the report, is the National Theatre’s War Horse, which even the original book’s author, Michael Morpurgo, had reservations about – but which has become a big moneyspinner.

Similarly, The Curious Incident of the Dog in the Night-Time, which dominated the Olivier theatre awards, could only have been created with public money. Its director, Marianne Elliott, said after receiving an award: “We took risks and thought we would fail and it is a testament to subsidised theatre that we were allowed to think we might fail.”

The report says there is much evidence to show that art and culture improves national productivity. “Engagement with arts and culture helps to develop people’s critical thinking, to cultivate creative problem solving and to communicate and express themselves effectively.”

Although consumer spending on the arts – its biggest income – increased between 2008 and 2010, it suffered a decline in 2011-12. The report warns: “It might be said that arts and culture is experiencing a pincer movement effect in the aftermath of the financial crisis: reduced consumer expenditure due to squeezed incomes, and reduced public spending.”

The report was welcomed by the investment banker John Studzinski, who chairs the east London arts organisation Create. “Everybody knows the enormous intangible benefits of the arts. What this report does is look at tangible benefits that economists and bureaucrats can now point to.”

Davey stressed that the primary concern from the Arts Council’s perspective was always the contribution culture makes to quality of life. “But at a time when public finances are under such pressure, it is also right to examine all the benefits that investment in arts and culture can bring – and to consider how much we can make the most effective use of that contribution.”

No 10 accused of ‘caving in’ to cigarette lobby as plain packs put on hold

Category : Business

Tobacco giant warned of loss of jobs in UK before packaging rules were dropped, and anti-smoking camp also cites possible fear of Ukip

Anti-smoking campaigners have accused the government of caving in to pressure from the tobacco lobby and running scared of Ukip after plans to enforce the sale of cigarettes in plain packs failed to make it into the Queen’s speech.

Minutes released by the Department of Health show that one of the industry’s leading players had told government officials that, if the move went through, it would source its packaging from abroad, resulting in “significant job losses.”

Cancer charities and health experts were expecting a bill to be introduced last week that would ban branded cigarette packaging, following a ban introduced in Australia last December. At least one health minister had been briefing that the bill would be in the Queen’s speech. But the bill was apparently put on hold at the last minute with the government saying it would be a distraction from its main legislative priorities.

Ukip, which enjoyed considerable success in last week’s elections, has positioned itself firmly on the side of smokers and there is a suspicion that the Tories scrapped the plan because they did not want to be seen as anti-smoking.

It has emerged that senior Department of Health officials held four key meetings with the industry’s leading players in January and February, when at least one of the tobacco giants spelled out to the government that its plan would result in thousands of jobs going abroad.

Department of Health minutes released last week reveal that Imperial Tobacco, British American Tobacco (BAT), Philip Morris International and Japan Tobacco International were each invited to make representations to the government, in which they attacked the plan and its impact on the UK economy.

Only the minutes of the meeting with Imperial have been released. They record that Imperial warned if plain packs were introduced it would source packaging from the Far East resulting “in significant job losses in the UK.”

The tobacco giant also outlined how its packaging research and development department supported small and medium-sized enterprises in the UK and argued that standard packs would “result in some of these being put out of business”.

It added that the plan would boost the illicit trade in cigarettes, which already costs the Treasury £3bn in unpaid duty and VAT a year. And it noted that 70,000 UK jobs rely on the tobacco supply chain, implying some of these would be threatened if the illicit market continued to grow.

When asked to hand over its assessment of the impact of the plan, Imperial refused, citing commercial sensitivity.

The decision to delay the introduction of plain packs is a major success for the tobacco lobby, which has run a ferocious campaign against the move. Cigarette makers fear that the loss of their branding will deprive them of their most powerful marketing weapon. The industry has backed a series of front campaign groups to make it appear that there is widespread opposition to the plan, a practice known in lobbying jargon as “astroturfing”. Many of the ideas were imported from Australia, where the tobacco giants fought a bitter but ultimately unsuccessful campaign to resist plain packs. Much of the Australian campaign was masterminded by the lobbying firm Crosby Textor, whose co-founder Lynton Crosby is spearheading the Tories’ 2015 election bid.

Crosby was federal director of the Liberal party in Australia when it accepted tobacco money. Crosby Textor in Australia was paid a retainer from BAT during the campaign against plain packs. Some anti-smoking campaigners are now questioning whether the decision to drop the plain packs bill was as a result of shifting allegiances at Westminster.

“It looks as if the noxious mix of rightwing Australian populism, as represented by Crosby and his lobbying firm, and English saloon bar reactionaries, as embodied by [Nigel] Farage and Ukip, may succeed in preventing this government from proceeding with standardised cigarette packs, despite their popularity with the public,” said Deborah Arnott, chief executive of the health charity Action on Smoking and Health.

The decision to drop the plan will become a divisive issue for the coalition because the Liberal Democrats were strongly in favour of the measure, which will still be introduced in Scotland.

It is also a concern for the government’s own health adviser. “Our view is that plain packaging is one of a range of measures shown to be effective in reducing the amount of people taking up smoking,” said Professor Kevin Fenton, director of health and wellbeing at Public Health England, the government agency charged with helping people to live longer and more healthily.

A Department of Health spokeswoman denied that tobacco lobbying had been a factor in the decision to pull the bill. “These minutes simply reflect what the tobacco company said at the meeting, not the government’s view,” she said. “The government has an open mind on this issue, and any decisions to take further action will be taken only after full consideration of the evidence and the consultation responses.”

Smoking: the government’s cowardly surrender to the tobacco lobby | Observer editorial

Category : Business

Cigarette manufacturers won a reprieve that will endanger more lives

It has been a big week for tobacco. The success of Ukip, a party keen to repeal the ban on smoking in pubs, has given cigarette companies an influential ally, one that has being doing sterling work seeking EU subsidies for tobacco growers.

Then came the momentous decision to drop plans that would have forced cigarette companies to sell their products in plain packs, something that even the powerful tobacco lobby must have thought out of its reach a few months ago.

But a relentless lobbying campaign that saw the industry channel money to spurious front groups to attack the plan has paid dividends. Stitching together a coalition that included newsagents, ex-police chiefs, retailers and brand organisations, not to mention hundreds of thousands of the public who signed a petition, the lobby strived to show the plan was unwanted and unworkable. Dire warnings were made of small shops going to the wall and thousands of jobs going abroad. The Treasury was warned that plain packs would be easy to copy, providing a major fillip to the counterfeit (untaxed) cigarette manufacturers.

Similar arguments were made in Australia by a big tobacco-funded campaign masterminded by a lobbying firm run by David Cameron’s election guru, Lynton Crosby. But Australia’s government introduced plain packaging last December. So far, there is no evidence that the dire predictions made by the tobacco lobby have been realised.

The tobacco industry argues that there is no evidence that plain packs discourage young people from starting to smoke. But inspection of tobacco industry documents released as a result of lawsuits reveals that the industry has been preparing for the battle for at least a quarter of a century. It will deny it, but the tobacco industry understands how brands lure in young smokers. It needs this new generation to replace the older one that it is killing. The UK government has a mandate to improve the health of its citizens. Last week, it failed them.

Health minister threatened with ejection from royal college

Category : Business

Earl Howe’s position on advisory committee under threat as doctors claim he ‘mis-sold’ health reforms

A health minister is facing the humiliation of being ousted from a prestigious role within the Royal College of Physicians over claims that he falsely reassured doctors who feared the coalition would privatise of the NHS.

Earl Howe’s position on an advisory committee is being reviewed following a complaint. Six influential members of the professional body that represents doctors wrote to its president, Sir Richard Thompson, claiming that the minister was “not a fit person to fulfil this important role”. Thompson has launched an investigation by the College’s trustees into Howe’s probity.

The senior doctors claim that Howe, a former banker, falsely advised them that reforms under the health and social care bill would not force doctors to use market mechanisms to choose where patients will be treated.

According to the doctors, the regulations will mean that clinical commissioning groups – the bodies to be set up by GPs to organise patients’ care – will have to put services out to tender if there is more than one provider capable of offering particular treatments. This means NHS hospitals and services will have to compete with private health firms for business.

Andy Burnham, the shadow health secretary, said there had been a breakdown in trust between health professionals and government, adding: “This whole issue has become a crisis of trust for the department of health. There would be a straight forward breach of trust given that statements ministers have given have not been honoured.

“The medical profession feels the government has mis-sold its NHS reforms. It was sold on the principle that doctors would be in control but in fact it will be the market that will decide.”

A spokeswoman confirmed that Thompson, and “in the interest of probity”, had “referred the issue to the board of trustees and would report back in June”.

She said the Friends of the RCP, the committee on which Howe serves, is an informal advisory group, including past presidents and officers, and figures from finance, industry, and other charities, that plays no role in the governance or management of the RCP but offers advice in areas such as effective fundraising.

The coalition denies the regulations will force doctors to put services out to tender, believing it will give GPs the ability to select a variety of providers and will improve standards.

Health minister threatened with ejection from royal college

Category : Business

Earl Howe’s position on advisory committee under threat as doctors claim he ‘mis-sold’ health reforms

A health minister is facing the humiliation of being ousted from a prestigious role within the Royal College of Physicians over claims that he falsely reassured doctors who feared the coalition would privatise of the NHS.

Earl Howe’s position on an advisory committee is being reviewed following a complaint. Six influential members of the professional body that represents doctors wrote to its president, Sir Richard Thompson, claiming that the minister was “not a fit person to fulfil this important role”. Thompson has launched an investigation by the College’s trustees into Howe’s probity.

The senior doctors claim that Howe, a former banker, falsely advised them that reforms under the health and social care bill would not force doctors to use market mechanisms to choose where patients will be treated.

According to the doctors, the regulations will mean that clinical commissioning groups – the bodies to be set up by GPs to organise patients’ care – will have to put services out to tender if there is more than one provider capable of offering particular treatments. This means NHS hospitals and services will have to compete with private health firms for business.

Andy Burnham, the shadow health secretary, said there had been a breakdown in trust between health professionals and government, adding: “This whole issue has become a crisis of trust for the department of health. There would be a straight forward breach of trust given that statements ministers have given have not been honoured.

“The medical profession feels the government has mis-sold its NHS reforms. It was sold on the principle that doctors would be in control but in fact it will be the market that will decide.”

A spokeswoman confirmed that Thompson, and “in the interest of probity”, had “referred the issue to the board of trustees and would report back in June”.

She said the Friends of the RCP, the committee on which Howe serves, is an informal advisory group, including past presidents and officers, and figures from finance, industry, and other charities, that plays no role in the governance or management of the RCP but offers advice in areas such as effective fundraising.

The coalition denies the regulations will force doctors to put services out to tender, believing it will give GPs the ability to select a variety of providers and will improve standards.

Nudged out: this is mutualisation, but not as we know it | Ed Mayo

Category : Business

The privatisation of No 10′s nudge unit, meant as a model for public services, is no John Lewis utopia for employees

It makes for a lovely headline. The much-trumpeted “nudge unit” in government is being nudged out and will be run as a private, mutual business. As one

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Hardship and poverty are different. Our welfare system should recognise this | Andrew Brown

Category : Business

The rightwing instinct is that all poverty is hardship – anyone can fight their way out. But some forms of poverty can’t be dodged

The Duke of Wellington once made me cry. I was sitting in a prep school dining hall, where we also sometimes studied, and I read in our textbook a passage where he had reacted to the horrible distress among workers and peasants in Britain after the Napoleonic wars – starvation and repression that led to the Peterloo massacre. His advice was that the poor should put curry powder in their drinking water. His troops, he said, had found this a useful substitute for food when on their campaigns in India.

When I read this I was at once seized by the most choking, terrible sadness. First my throat and then the whole building smelled thick with snot in a most disgusting way. I had to rush to the lavatories and rub my face with cold water before I could breathe and stop weeping.

Life at boarding school is full of such moments, but what made this one remarkable was not just its quality of physical horror: the emotion I felt was overwhelmingly pity for the Duke because everyone would see him as heartless whereas in fact he was trying to be practical. Sometimes there is nothing to eat. Sometimes curry powder in water is the best you can do. Of course, this was also bound up in my mind with the fact that you couldn’t, in those days, get curry powder in the English provinces. I hated England.

In those days, at the Dragon school, the food could be so awful that curry powder in water would have been better. We were given milk in bottles that held a third of a pint, and were stored, in crates, without refrigeration. This meant in summer that the good milk was tinged with sourness; the bad milk was practically acid, and the worst milk had entirely separated into curds and whey. It all got drunk.

Yet this kind of physical hardship had nothing much to do with poverty. Our parents were paying good money to have us educated there and the school was not particularly heartless. It just had an ethos that paid little account to physical pleasure. There was an expectation that we should learn to endure discomfort. It was absolutely not the same as a belief that discomfort was all life would hold.

The distinction between hardship and poverty makes sense of much discussion about austerity. Hardship is an exceptional state, but poverty is a life sentence from which you can only be released on license, and can never know when. It’s very clearly illustrated by the life of Jocasta Innes, who died last week. Her Pauper’s cookbook was a bestseller in the 70s. It wasn’t in the least bit glamorous – this was before celebrity cooks – and much of the food in it was unpleasant. But it was larky, practical and full of encouragement.

She wrote it in conditions of considerable hardship: she had left one husband and two children to live with a penniless novelist and have two more children, whom she fed on a very small budget. But she had a degree from Cambridge, she had been privately educated. She knew things might get better, and they did.

The rightwing instinct is that all poverty can be reinterpreted as hardship: with sufficient energy and determination, anyone can fight their way out of it. This isn’t entirely false. In fact it’s obviously half true, and a great deal of the emotional energy of rightwing rhetoric is generated by outrage when people seem to be denying this obvious truth.

Looking back, a lot of my training in school could be understood as learning to see the world in terms of hardships that could be overcome, rather than deprivations that must be stoically endured. And this was good and useful.

None the less, there are some deprivations that simply have to be endured, some forms of poverty that can’t be dodged. Talent and luck are unequally distributed among determined strivers. Few single mothers can write bestselling books, or start a decorating business on the back of them.

So a proper welfare system would need to distinguish between poverty and hardship and apply different remedies. Water and curry powder for some: real food for others. This is certainly how welfare is supposed to function in Sweden. I suspect it is what Iain Duncan Smith is trying to do right now, with such resounding inadequacy. And perhaps it can’t be done in any really satisfying way. Perhaps the people who thought the Duke of Wellington a heartless bastard were quite right.

Help to Buy risks helping to create another housing bubble

Category : Business

In his ‘emergency’ budget in 2010, George Osborne pledged to create a less debt-fuelled economy. Where is that promise now?

The late Eddie George, in 2002, brought the phrase “two-speed economy” into common parlance, telling an audience in Scotland: “We have taken the view that unbalanced growth in our present situation is better than no growth – or, as some commentators have put it, a two-speed economy is better than a no-speed economy.”

But his words could just as well have been applied to last week’s GDP figures. While it was undoubtedly great news that the UK has skirted around a “triple dip”, the breakdown of the numbers suggested that, far from achieving the rebalancing George Osborne hoped for, away from consumers and towards industry, the mix of growth looks much as it did a decade ago. Manufacturing output declined; services expanded; government spending made a positive contribution. Industrial output is still 10% below its pre-crisis peak.

Yet far from acting to redress the balance, the coalition’s latest policies read like a desperate attempt to return to the unstable, unsustainable norms of the early noughties.

Help to Buy, announced in the budget, will offer taxpayer backing for up to £130bn worth of mortgage lending, while last week’s extension of the Funding for Lending scheme will allow banks to receive £10 of cheap funding for every pound they lend to small businesses in 2013 – and lend it back out again in any way they like, including to buy-to-let investors.

Back in 2002, George wanted to reassure consumers they would not face a runup in interest rates – because with other sources of growth, such as industry and exports, struggling, the Bank was willing to allow Britain’s shoppers to continue propping up demand with their buy now, pay later spending habits rather than risk economic stagnation.

When he spoke, the cost of the average home was less than £96,000, though prices were already rising at double-digit rates; by the peak of the boom, little more than five years later, it had all but doubled, to £183,959.

Alongside that extraordinary growth in house prices came an unprecedented explosion in household debt. But constantly rising prices bred a warm feeling of confidence among homeowners and fuelled a sense of entitlement to the unearned benefits of rampant housing-market inflation, creating a ready-made lobby group opposing changes to inheritance tax, council tax or any other method of sharing the windfall more widely.

In Osborne’s first, “emergency”, budget in 2010, he carefully laid out his intention of building a safer, more stable economy, less reliant on debt-fuelled spending. Yet three years on, scarred by the failure of the pound’s 20% depreciation to spark an industrial renaissance, he appears to be banking on the two-speed doctrine to lift him clear of trouble.

Osborne has insisted that Help to Buy is not aimed at pushing up prices. But encouraging first-time buyers to take out mortgages with high loan-to-value ratios – on properties whose value may be unsustainable even at current levels, let alone after another market bounce – is hardly a recipe for a fairer or more stable economy.

The Treasury claims to hope the policy will stimulate housebuilding, helping to ease the chronic shortage of homes that has driven up prices; but as the Treasury select committee rightly pointed out in its report on the budget, if the government really wanted to kickstart building, it should act to do so directly. That might mean taking advantage of record low gilt yields to invest in council housing, for example. But as Pete Jefferys of Shelter put it in a blog last week, Help to Buy is a “Thatcher-style home ownership revolution, not a Macmillan-style housebuilding boom”.

Neither does pumping out a new generation of cut-price loans – which, remember, will be available to anyone buying a house worth up to £600,000 – tackle the problem of banks still saddled with shaky-looking mortgages from the boom years. It just postpones the reckoning – and risks making it worse when it comes.

There is agreement across the political spectrum that Britain faces a housing crisis: a generation of young people have little or no prospect of affording a place to live, and find themselves trapped in insecure, poor-quality rental housing owned by landlords out to make a quick buck.

But first-time buyers need cheaper homes, not bigger loans, and the chancellor’s argument is reminiscent of those who used to claim vehemently in the mid-noughties that allowing low-paid workers to borrow six times their income was socially necessary, because otherwise young people wouldn’t be able to afford a home.

A mass programme of publicly funded housebuilding, along the lines stirringly recreated in Ken Loach’s documentary The Spirit of ’45, could boost supply dramatically and help to rebuild the shattered construction sector, while tougher regulation of the rental market could ease the pain for those unable to afford their own home.

And taxing housing more heavily – whether through a more progressive council tax system, heftier inheritance levies or a land value tax, under which homeowners would pay a small percentage of the value of their property each year – could help to prevent the next bubble inflating. Instead, the government appears intent on subsidising it.