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Scots first in line for loan help from RBS

Who would have thought there were so many benefits to being Scottish?

The Scottish government is currently planning the latest in a long line of rewards for those north of the border by abolishing prescription charges by 2011.

This will be funded by taxpayers across the UK – predominantly the English, who must begrudgingly continue to pay for their own prescriptions.

It doesn’t stop there. Scottish students studying in Scotland pay no tuition fees for undergraduate university courses, although English and Welsh students studying in Scotland have to pay 1,775 per annum.

The Scots benefit from free eye tests and dental check-ups. There is also free bus travel, local and day for those aged over 65 in Scotland (compared with free off-peak local travel to the English over-60s).

For the second successive year, council tax will also be frozen across Scotland. All 32 councils have agreed to freeze this unpopular tax, receiving a share of the 70m set aside by the Scottish government to support the measure.

But just when it looked as though Scotland had all the perks, it turns out there are more to come.

Royal Bank of Scotland, which has been bailed out to the tune of billions of pounds by UK taxpayers, recently announced that it will pump 1.7bn worth of mortgages into the Scottish housing market over the coming year.

There was no mention of the English or Welsh housing markets, which are also struggling through lack of funding.

RBS said it would consider loans up to 90% to help Scottish first-time buyers get on the property ladder and that it was committed to releasing further funds to help reinvigorate Scotland’s housing market if customer demand dictated.

To rub it in further, Paul Geddes, chief executive of consumer banking at RBS, told the BBC: “Our message to customers in Scotland is very clear: we are now more than ever open for mortgage business”.

That’s all very well and no doubt good for the housing market generally, and first-time buyers in particular – north of the border. But what about the rest of the country?

“With interest rates having reached a record low, it is crucial that the banks now lend effectively and appropriately to help householders and businesses across Scotland,” says Scotland’s finance secretary John Swinney.

Laudable intentions indeed but I repeat the question: what about the rest of the UK?

The lending package includes 500m released through the Treasury’s Asset Protection Scheme, which is funded by the UK taxpayer, not just the Scottish one.

It seems completely unfair that mortgage applications will be judged not on the borrower’s ability to pay but first and foremost on the basis of where they live.

Gordon Brown and Alistair Darling, both Scots themselves of course, should be looking very carefully at this discrimination.

Meanwhile, the English will have to content themselves with the fact that no matter what perks the Scots enjoy, their national football team is still rubbish.


Marketwatch 30/03/2009

Swaps had another mixed week, with short-term money falling and longer term money edging up.


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