GORDON BROWN and Alistair Darling are telling the banks that they expect them to offer continued funding to businesses at similar terms and rates as earlier this year.

The Bank of England, through the Monetary Policy Committee, is pushing interest rates downward and the London Inter Bank Ordinary Rate is slightly down at 6%. National governments such as the USA and France have provided massive liquidity and recapitalisation support, in the case of the USA at 2% cost and France 5%.

The ability of UK banks to provide low-cost funding to the business sector, or provide reasonably priced domestic mortgages, is strongly influenced by their cost of money. Why is it that Gordon Brown is charging 12% to British banks for its bail-out monies? If British banks are paying six times as much interest as US banks and 2½ times as much as French banks, how on earth can they afford to lend at the same rates as we all enjoyed earlier this year?

Gordon Brown publicly asks the banks for restraint in bank charges, yet indirectly forces them to charge higher rates to cover his excessive interest. He might have assisted the short-term survival of UK banks- but UK businesses and domestic borrowers will still be paying higher interest than many other nations.

The only way our banks can possibly pay 12% without large increases in loan costs is to deprive private shareholders and national pension funds of dividends. If Gordon and Alistair persist with this policy, they will make bank shares untradable, and severely damage the fund values of most pension funds who are the largest holders of bank shares. There is a risk that these actions might add to existing pressures upon pension fund stability and trigger the next phase in our financial crisis.

Les Spencer, Saughall Massie

No super cabinet

YOU reported on Saturday that a six-member Merseyside City Region “super-cabinet” is being formed, which will supposedly make significant decisions and spend considerable amounts of devolved Whitehall funding.

It will also liaise closely with other neighbouring councils over issues directly affecting them.

To me, this is the Government attempting to deliver, via the back door, a regional agenda which was dealt a fatal blow when rejected overwhelmingly by North East voters in a referendum less than three years ago.

Such a development may have some logic for facilitating delivery of a small number of individual, large sub-regional projects, but there is real danger of a growing democratic deficit here. In addition, past experience shows that such promised Government funding is rarely, if ever, new money, but is merely top-sliced from other budgets, the most recent example being the claimed hundreds of millions to aid struggling homeowners which, as you reported, led immediately to £50m being taken from NWDA funds to help fund it.

In addition, this will enable the Labour Government to exert extra political sway over Liberal Democrat-led Liverpool via a body dominated by Labour leaders. This proposed thin end of the wedge “super-cabinet” should be stoutly resisted.

Cllr Paul Clein, Liverpool City Council

Losses mean closure

I FIND the Countryside Alliance complaining about the closure of rural post offices interesting.

I would have thought that this organisation would be in favour of businesses operating at a profit.

These businesses are ultimately under threat because they are not being supported by the local residents.

Buying stamps and sending the occasional parcel on your way to and from the supermarket is not enough. The communities are not using them, so they are paying the price by losing them.

The Post Office is a business owned by us taxpayers. It should therefore make a profit, like every other business.

Any commercial organisation would behave in a similar way, by closing down loss-making activities. Any loss that the Post Office makes is funded by the taxpayer. So why should the taxpayer have to fund a loss-making post office that most of the local residents have stopped using?

R Williams, via email

Good wages are key

MONDAY saw the start of a new system to determine Incapacity Benefit which, as the old system had failed – leading to preposterously high levels in some ex-mining communities and in inner city areas – might be welcomed.

The problem is that, like many government changes to benefit, rightfully condemned by the TUC, it seems that, rather than assisting people into work, it is more about penalising claimants and giving greater power to pedantic bureaucrats.

What is needed, especially in London (areas of which have some of the highest unemployment levels), are jobs that provide a living wage.

On a separate issue, as the economic downturn escalates, one hopes that the Government who negotiated contracts (eg, PFIs, the steel for the new aircraft carriers, etc) will re-negotiate them as the cost of steel and construction labour comes down from absurd peaks. Likewise, we must hope that the water regulator will kick out the demands from the water companies for yet more hikes in water rate charges as their costs also come down. I also hope that the senior bureaucrats and politicians, whose policies brought us into this recession, will see their salaries deflated – reducing their burden on the public purse.

Mark Bill, via email

MTV ticket success

I HAD a call from my aunt today telling me about two letters from people regarding the MTV Europe Music Awards, in which they asked if anyone from Liverpool had actually managed to get tickets.

Well, I am a Scouser born and bred, and I managed to get hold of tickets.

I know it was the luck of the draw, and people must be angry and are going on about how it should be for Capital of Culture, but these people have to understand that this is the MTV EUROPE Music Awards – for the whole of Europe!

People are going to want to go, as this is a once-in-a-lifetime opportunity for some to get to see their favourite acts. People will travel from all over the world to see this.

I know I am in a fortunate position in that I have tickets and possibly I, too, would complain if I hadn’t had them, but this is a worldwide event and Liverpool people should just be happy that the city has been chosen for such an event.

A happy Scouser, address supplied

Beware bag search

I READ this week that Customs officials at airports can now open your bag before you come through Customs and into the UK. A couple of years ago, this happened to myself and my husband as we travelled back from Miami.

We picked our luggage up off the carousel as we arrived back at the airport after a very long and delayed flight, only to find it had been – well, ransacked is the best word for it.

There was no note of explanation or anything, and one of my dresses was ruined because it had been left trailing out of the case.

I realise that Customs officials are there to keep us safe and to prevent laws being broken, but surely they could have waited until we had the cases in our possession. I would have been more than happy to open it for them and repack it neatly myself.

We were told we could write a letter of complaint, but needless to say it got us nowhere.

M Thompson, via email

Help the Baltic Fleet

I REALLY feel sorry for the people at the Baltic Fleet pub (“Spruce up this ghost town and help us out”, Daily Post, October 27).

This is a fantastic little pub with an incredible heritage.

I have long been a fan of the odd jar down there, and they do so much work to keep themselves going against all odds.

The pub has just undergone a makeover and looks incredible, but there is really only so much the pub can do itself to battle against the ghost town landscape it is trapped in.

Surely the council or the Culture Company or someone can help sooner, rather than later.

JH, Aigburth

Shame on yobs

I WAS utterly disgusted at the story on your website yesterday about the yobs setting fires to lure firefighters and then actually attacking the firefighters when then came along to try and put them out.

What is going through the minds of these morons that they want to attack people who have dedicated their lives to saving others?

I hope that the police find these idiots as soon as possible.

Mrs A Swan, Huyton

Paper bags only

GREAT news about the eco-friendly supermarket (Daily Post, October 27). Asda should really be commended for taking such proactive steps in doing something for the environment.

The article, however, does not make mention of plastic carrier bags. Can we assume that the store will boost its eco-credentials by not giving them away? Personally, I have never understood why stores here have not adopted the American approach of giving customers brown paper bags.

L Molloy, Crosby