We have been so busy at UK PLC that I have not written to you the shareholders for some time. Now there is a little August pause I am able to do so.
I am pleased to report that our recently acquired bank subsidiaries remain loss making. Some of you were concerned in case the large losses of 2008 were not sustainable, and even speculated that we might be forced into profits this year. Fortunately we should be able to continue with a satisfactory rate of loss, although it would be unrealistic to expect us to sustain the level of 2008 which was exceptional. We did write off quite a lot of the past losses then, but there should still be plenty to use this year to keep us in the red overall.
The main advance in 2009 is in the successful build up of new debt. Last year we set out to put your company onto a totally new footing. We decided on borrowing £417 billion in just two years, an audacious expansion. We have felt for some time that other sectors of the economy have geared more than we have, and it is high time we geared UK PLC to the maximum possible.
Some said we would not be able to raise this much debt, and wondered if at a time when others had come unstuck by borrowing too much it was a good idea. We are proving them wrong. One of the ways we have ensured that we can raise this much debt has been to authorise our subsidiary the Bank of England to buy up parts of our debt ourselves, thus stimulating demand for it. Our market power, combined with the opportunity to buy our own debt, has ensured that we have dominated the borrowing market, keeping most others out and allowing us to become the largest borrower the country has ever seen by miles.
We have not neglected our other main strategy, to make sure that everyone in the UK is affected by the actions of UK PLC. We leave no stone unturned to make sure people have heard of us and pay us money. Indeed, our revenue raising strategy requires us to find more ways of taxing and fining people, to offset the reductions in revenues we are experiencing as result of the economic downturn.
We have been especially successful at finding new and developing old ways of mugging motorists. We are bringing in extra taxes on fuel, and making as many complicated rules and speed limit changes as possible to raise the fine revenue. Our local subsidiaries are exploring new charges and rules on parking, and have developed an imposing array of levies and licence payments for people wishing to build, run events, operate pubs, clubs and gaming businesses and run taxi services.
We are always on the look out for new ways to let you pay for UK PLC. You must appreciate that whilst we have been able to put more of the spending than ever before onto the company’s mortgage, we have been so good at increasing spending we do need to keep the revenues up as well. We were too successful in encouraging and allowing some of our salesforce to claim expenses and have had to rein it in a bit. The temporary check to that budget will be entirely lost by the extra salaries, bonuses and expense claims elsewhere in the organisation so it will not prevent us recording record spending. Indeed, if you look at the pay and expense claims in our media and banking subsidiaries, they dwarf the salesforce claims.
We have employed good PR consultants recently to capture the essence of what we do -at your expense I am pleased to say. Our two new catch phrases are “Never knowingly underborrowed” and “Making sure you all pay for all that we enjoy”. I am sure you will agree this sums up so well our unique proposition.
The Directors and other senior executives are spending most of their time on attacking the claims of our rivals, Conco, who think they should have the management contract for our great company. We cannot see how they could conceivably spend, borrow and waste as much as us, and will hammer home this message as often as possible.