Alberta Oil Sands a Pollution Nightmare

By Timothy B. Hurst
December 6 2008
Extraction and refining heavy oil from Canadian tar sands will have increasingly devastating impacts on migratory bird populations, according to a new study.

oil refinery in canadian tar sands

According to anew report, the cumulative impact of developing Canadian tar sands over the next 30–50 years could be as high as 166 million birds lost, including future generations. Written by scientists from the Natural Resources Defense Council, Boreal Songbird Initiative, and Pembina Institute, the peer-reviewed paper suggests that avian mortality from continued development of Canada’s tar sands would provide a serious blow to migratory bird populations in North America.

It is estimated that half of America’s migratory birds nest in the Boreal forest, and each year 22–170 million birds breed in the area that could eventually be developed for tar sands oil if the rate of development continues at it is currently planned.

“At a time when bird populations are rapidly declining, this report puts into perspective the far reaching effects of tar sands oil development on North America’s birds,” said the report’s lead author Jeff Wells, Ph.D. of the Boreal Songbird Initiative. “The public needs to understand the real and long-term ecological costs of this development and determine if this is acceptable,” added Wells.

suncor tar sands mining in alberta, canada

In Alberta, tar sands mining and drilling causes significant habitat loss and fragmentation. Expansive toxic tailings ponds are protected by propane cannons that are used to keep ducks from landing in them.

toxic oil shale tailings

When those cannons fail, we see unfortunate accidents like the one this past summer in Alberta when some 500 ducks were killed after landing in a tailings pond. Toxic tailing ponds result in 8,000 to 100,000 oiled and drowned birds annually.

duck being cleaned of oil

Authors of the report suggest that an immediate solution to the unsustainable pace of development and to environmental problems relating to tar sands oil development is a moratorium on all new projects, project expansions, and to clean up existing projects.

For Canada to take the kind of substantive action necessary to prevent the ecological damage suggested by this report, it may require international pressure; the kind of pressure that could be applied by a renegotiated NAFTA that strengthens environmental laws, something that president-elect Obama has suggested he would like to see.

Images courtesy of: 1. & 3. David Dodge/Pembina Institute; 2. & 4. D. Faucher/Ducks Unlimited; 5. Sun Media Corp.

Source

The report covers the various ways tar sands development affects bird populations, including:

-Habitat Loss
-Tailings Ponds and Oiled Birds
-Fragmentation of Habitat from Drilling
-Water Withdrawals
-Air and Water Toxins
-High Emissions and Global Warming

In the Beginning.

1970’s Film – The Tar Sands

This clip shows the various refinement steps required to convert tar sands into usable crude oil and other petroleum products.

The methods have changed since then, but the  environmental impact is still very disturbing.

As Alberta’s tar sands production continues to increase at a rapid rate new ‘tailings ponds’ or toxic lakes from spent refining of the heavy crude oil trapped in sand are popping up everywhere and kilometers in size for the most part.

Tar Sands the Beginning of the End of the Carbon Age -Clearing the forest for the Oil Sands

At the Athabasca tar sands deposits north of Fort McMurray companies like Syncrude move unfettered and with strong support from local media companies despite the high pollution levels and carbon dioxide emissions.

America Looks to Canada’s Tar Sands for Next Century As the neighbor to the north Canada it appears is more then happy to develop its tar sands at any cost and as fast as possible despite the environmental fallout from the heavy crude oil reserves.

Source for Videos

Alberta  Oil Sands Cause Acid Rain

The Human Cost

By Matthew Kruchak and James Wood
February 16, 2008

Acid rain caused by Alberta oilsands production is pouring down on Saskatchewan and if governments don’t take note, any oilsands development in this province will contribute to the “most destructive project on Earth,” the Environmental Defence organization warns.

A report released Friday by the group says 70 per cent of the sulphur entering Alberta’s air ends up in Saskatchewan. Acid rain is produced by the interaction between water, sulphur and nitrogen oxides.

“Acid rain causes damage and death to the ecosystem and also human health,” said Christopher Hatch, a climate change campaigner with Environmental Defence. “People in Saskatchewan should be very concerned that neither the federal nor provincial governments are getting to the bottom of this.

“So what is it that they don’t want people to know? There’s obviously a problem — any layperson can tell that. Why are they not funding studies to ensure human health?”

The report, titled Canada’s Toxic Tar Sands: The Most Destructive Project on Earth, outlines the environmental and human health effects of the oilsands and offers the federal government solutions, Hatch said.

“It’s a toxic nightmare — it really is,” he said. “To fly over the Alberta oilsands as it is — and it’s only just beginning — it’s a toxic moonscape.”

The group is calling on the federal government to step in and force the cleanup or work with the Alberta government to address environmental issues, he said.

In the past 12 years, at a Saskatchewan site (which was not identified) 200 kilometres downwind from the oilsands, the mean level of acid in precipitation had increased, the report stated, with measurements going from pH 5.3 to 4.1. Normal rainfall has a pH of 5.6.

Saskatchewan Environment ran 10 monitoring stations across the oilsands in the northwest of the province and found a buildup of nitrogen from Alberta, the report stated in a section called Raining Acid on Saskatchewan.

“On the toxic front, it’s really a looming human health disaster,” Hatch said.

Environment Minster Nancy Heppner had little to say about the report Friday.

Asked about the environmental impact of the Alberta oilsands projects, Heppner said she didn’t have any details.

“I’ve heard things, that water’s being contaminated and those sorts of things. I don’t have any specifics. I haven’t seen the report you are talking about today and obviously there’s more information we’ll be looking at to make sure that if there were mistakes made on the Alberta side that we won’t be making those here,” Heppner told reporters at the legislature just before leaving for a climate change conference in Australia.

However, she said the government is concerned about acid rain from the oilsands.

“I understand there’s some concern and we’ve met with some people, some residents of northern Saskatchewan, who are concerned about acidification of our lakes and that’s something we’re going to look at,” said Heppner.

NDP environment critic Sandra Morin questioned Heppner’s lack of knowledge about the report.

Morin said “she had no reason to doubt” the report’s characterization of the oilsands as “the most destructive project on Earth.”

“It’s incredibly distressing that 70 per cent of the acid rain, the contamination, is going to be affecting Saskatchewan. Clearly, with the development happening there and 70 per cent of those emissions affecting Saskatchewan people, one has to be concerned about the further development of the oilsands in Alberta, which is supposed to triple in the next 10 years, not to mention the further development of the oilsands projects that are happening in Saskatchewan.”

The Saskatchewan Party government is supportive of oilsands projects in this province, but Heppner said the environment won’t be sacrificed.

“We are committed as a government going forward with development to make sure the environment is protected. There are environmental impact assessments that are done for projects and that will certainly be the case going forward. We do not want our environment to be destroyed while we develop our province,” she said.

Officials from the Ministry of Environment were unavailable for comment Friday.

A representative from Oilsands Quest, a company leading the development of the oilsands industry in Saskatchewan, was also unavailable for comment Friday.

Source

I  love this car more every day.

Solar car completes 1st round-the-world trip

These ones too.

Car that runs on air!

Air Car (1 of 2) from France

Air Car (2 of 2) from Australia

The UN’s carbon trading system in numbers

The United Nations’ Clean Development Mechanism was intended to offer rich countries an efficient market mechanism to achieve some of of their emission-cutting obligations at lower cost by installing green technology in developing countries. Since the Kyoto Protocol came into force in 2005, more than 1,800 projects have been registered.

In other words Carbon Credits means going into another country setting up a facility and selling the product. Privatization and profit.

This does nothing to remove pollution from ones country just an opportunity for profit in another country.

Pollution should be removed from your own country, not using another country to make it look like you are removing pollution from your own.

Carbon Credits are bogus.

Added May 15 2012

Stop Enbridge Northern Gateway pipeline and tanker project

Please Sign petition below.

http://freedomtrain2012.nationbuilder.com/

Added September 7 2010

More birds dying in Alberta oil sands than first reported

‘Secret’ Environment Canada presentation warns of oilsands’ impact on habitat December 22, 2011

“Canada”Trouble in Toryland: their Dirty Tricks catalogue March 2 2012

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Pollution Costs Trillions Annually

Fresh water pollution costs at least $4.3 billion a year

December 1 2008

By Shannon McAleenan

Manhattan, KS

Researchers at Kansas State University found that pollutants aren’t just bad for lakes and streams-they’re bad for American’s pocketbooks also.

Walter Dodds, professor of biology of KSU says freshwater pollution impacts individuals on a level as basic as bottled water costs. If the municipal water plant has to spend more to treat water coming through the taps, that cost is passed onto consumer through water bills.

“Monetary damages put environmental problems in terms that make policymakers and the public take notice,” Dodds said in a statement from KSU.

The team of researchers looked at U.S. EPA data on nitrogen and phosphorus levels in bodies of water across the country-both these pollutants are applied to plants as nutrients. Most of these pollutants reach lakes and other water from various points, like runoff from row crop agriculture.

The KSU team calculated the money lost from pollution by examining many factors like decreasing lakefront property values, the cost of treating drinking water and revenue lost when fewer people take part in recreational activities like fishing or boating. They found that freshwater pollution by nitrogen and phosphorus costs government, drinking water facilities and individual Americans at least $4.3 billion a year.

“We are providing underestimates,” Dodds said in the statement. “Although our accounting of the degree of nutrient pollution in the nation is fairly accurate, the true costs of pollution are probably much greater than $4.3 billion.”

The research appeared in the Nov. 12 online issue of Environmental Science and Technology.

Human cost of valley’s dirty air: $6.3 billion
By Mark Grossi
November 13 2008

FRESNO – There’s a new annual price tag for breathing dirty air in the San Joaquin Valley: $6.3 billion, mostly because more than 800 people die years earlier than they should.

That’s more fatalities due to bad air than car accidents, said nationally known economist Jane V. Hall, who Wednesday released her latest analysis of poor air quality in this region.

The dollar and death figures are nearly twice as high as Hall found in her first study two years ago, partly because stricter federal standards are in force. The new standards assume more people are harmed by bad air.

But she also said new research indicates microscopic specks of soot and chemicals are more dangerous than previously thought.

“There is a clearer consensus that lives are being shortened,” she said.

The study, funded with a $90,000 grant from the William and Flora Hewlett Foundation, is intended to jolt residents, regulators and political leaders.

Hall, a California State University, Fullerton, scientist, worked with researchers Victor Brajer and Frederick W. Lurmann on the study, which also covered the South Coast Air Basin.

The study points out the continuing need to battle air pollution, said Seyed Sadredin, executive director of the San Joaquin Valley Air Pollution Control District. But he also said people still should understand air quality has improved.

“Things are not getting worse. These bigger numbers are the result of a new standard,” said Sadredin. “But this study does give the valley good justification to advocate for more support in fighting air pollution.”

The premature deaths and mounting costs are unacceptable, said Liza Bolaños, coordinator for the Central Valley Air Quality Coalition, a nonprofit group representing public health and environmental organizations.

“We have the capacity to clean this up,” she said. “This is a wake-up call.”

Hall and the other researchers said more than half the state’s residents – 20 million people in the valley and South Coast – are exposed regularly to unhealthy levels of ozone and particle pollution.

The researchers combined the cost of breathing dirty air in both basins, arriving at a total of $28 billion. Health care costs and time lost at work are included in the total, but more than 80 percent of the cost is related to the value of the estimated 3,800 lives lost prematurely each year.

Microscopic specks called PM-2.5, which are more prevalent in colder weather, are the biggest worry. Most of the region’s $6.3 billion cost is the value of people who die prematurely from exposure to PM-2.5.

Fresno last year had 75 bad days for PM-2.5, Bakersfield had 68 and Visalia 64. In the north valley, Modesto had 39 bad days. This region is considered one of the worst in the state for such pollution.

“In the San Joaquin Valley, 100 percent of the residents are exposed to fine-particle pollution at some time during the year,” said Hall.

The PM-2.5 comes from many sources, such as diesel engines and fireplaces. But it also forms in the moist winter air when ammonia from dairy waste combines with vehicle exhaust.

Fresno County residents suffer the valley’s biggest effects, with the loss of 212 people each year, valued at $1.4 billion, according to the report. The county also has the valley’s highest yearly total of non-fatal heart attacks related to air quality – 156. PM-2.5 pollution has been linked to heart disease.

Hall and Brajer said the valley’s 823 annual air-related deaths occur about 14 years sooner than they should.

The cost of each premature death is set about $6.7 million, a figure based on mainstream economic and federal studies of social value. Such figures have been used in economic analysis of social problems for decades, researchers said.

“We’re not trying to value a single person,” said Brajer. “This is a social value on reducing the risk of early death.”

Source

Charles River Property Owners Must Now Control Stormwater

BOSTON, Massachusetts,

December 1, 2008

The U.S. EPA and the state of Massachusetts are about to impose stormwater permit controls on industrial, commercial and high-density residential facilities in the Charles River watershed.Stormwater containing high levels of phosphorus is blamed for neon blue-green algae blooms of toxic cyanobacteria that have taken over the river in the summer months for the past several years.

The federal and state actions will require the owners of industrial, commercial and residential facilities in the upstream towns of Milford, Franklin, and Bellingham with two or more acres of impervious area – such as parking lots, roofs, and roads – to operate under a Clean Water Act permit.

“Polluted stormwater runoff causes serious water quality problems, and is the next great challenge for cleaning the Charles River,” said Robert Varney, regional administrator of the EPA’s New England office.

“By working closely with Massachusetts and our other partners, we will make great environmental improvements, while at the same time providing facilities with flexibility and time to meet the new standards,” Varney said. “Working together cooperatively, we can solve these problems.”

The new actions, announced in November, will ensure that property owners take responsibility for runoff from their sites.

Blue-green algae on the Charles River as it flows through Boston, Massachusetts (Photo courtesy EPA)

In a separate but related action, the Commonwealth of Massachusetts is enacting a statewide requirement for facilities with five or more acres of impervious area to reduce stormwater runoff.

“Many of our state’s waters are severely degraded as a result of stormwater pollution,” said Massachusetts Energy and Environmental Affairs Secretary Ian Bowles. “Now is the time to take action to reduce pollution and return more water to the ground, where it will be cleaned naturally and added to our water supplies.”

Under both the federal and state actions, new requirements will be phased in to reduce polluted stormwater runoff at sites with large paved areas, including shopping malls and industrial areas.

While the statewide standard will be five acres, Massachusetts is proposing to match EPA’s two-acre requirement in the Charles, where a higher level of control is needed to address chronic water quality problems.

“Until now, managing stormwater has largely been the responsibility of the cities and towns,” said Laurie Burt, commissioner of the Massachusetts Department of Environmental Protection. “It is critical now for other property owners to step up to the plate and do their part. This new program creates a level playing field by requiring that the responsibility for managing stormwater be shared by municipalities and private property owners.”

Cities and towns across Massachusetts have invested in improving their sewer and stormwater infrastructure, yielding substantial water quality benefits, said Varney.

“Our work will also help local municipalities, who up until now have shouldered the burden alone to take action to reduce pollution to our rivers, lakes and other waterways,” he said.

Commercial, industrial and high-density residential facilities with two or more acres of impervious area will be required apply for a Clean Water Act permit for stormwater discharges which eventually reach the Charles River.

The permits will require that these facilities reduce phosphorus discharges by 65 percent through a variety of stormwater management practices. Ultimately, these requirements will likely apply to the entire Charles River watershed, said state and federal officials.

“EPA’s extension of the Clean Water Act to include polluted stormwater runoff from commercial and industrial parking lots is both bold, and necessary,” said Bob Zimmerman, executive director of the Charles River Watershed Association.

“We will never clean up urban rivers without cleaning up existing runoff from pavement. This bold move will aid cities and towns meet their requirements, and help restore a more natural balance to the way water works in metropolitan regions, not just in the Charles River, but ultimately across the United States,” Zimmerman said.

“It is time for existing commercial and industrial developments to do their fair share to clean up the stormwater pollution that is threatening public health and recreation in New England’s waters,” said Christopher Kilian, director of the Conservation Law Foundation’s Clean Water and Healthy Forests Program. “The EPA took this precedent-setting action because the Clean Water Act’s mandates don’t allow this pollution to go unaddressed.”

In October 2007, EPA and the state began a process to limit phosphorus entering the Charles River by establishing a new Total Maximum Daily Load for discharges of phosphorus into the lower Charles River.

Since 1995, the EPA’s Clean Charles Initiative has coordinated efforts between EPA, state and local governments, private organizations, and environmental advocates. Cities and towns along the Charles have invested hundreds of millions of dollars in stormwater and sewer improvements.

Source

The cost of coal use last year was EUR 360 billion, according to a new report, which accounts for carbon dioxide (CO2) emissions, health impacts and mining accidents in determining the ‘true’ price paid by global society for relying on the dirtiest of fossil fuels.

The report, “The True Cost of Coal,” released by Greenpeace and the independent Dutch Institute CE Delft, arrived at this figure by looking the external costs of coal in 2007 for damages attributable to climate change, human health impacts from air pollution and fatalities due to major mining accidents–factors for which reasonably reliable global data is currently available.

“The relentless expansion of the coal industry is the single greatest threat to averting dangerous climate change. Coal is the most climate-polluting fossil fuel, responsible for one third of all CO2 emissions, and is projected to increase to 60% of emissions by 2030,” Joris Thijssen, climate and energy campaigner with Greenpeace International, told a press conference. “Clearly, quitting coal will benefit not only the climate, but also reduce the other impacts which everybody else has to pay for.”

The report was released as Industry Ministers from at least 20 big emitting countries met in Warsaw with the world’s climate-polluting industries.

Earlier in the day Greenpeace activists dumped lignite, dirty brown coal that makes up a large portion of Poland’s mining output, outside of the Warsaw Sheraton..

Greenpeace Poland campaign director Maciej Muskat said that Greenpeace strongly suspected the Polish Government had organised the meeting for the wrong reasons.

“The Polish people are already paying a high price for the cost of coal, through health impacts and the loss of lakes and ecosystems. Instead of concentrating on trying to shore up opposition against action on climate at both the Poznan meeting and the EU climate-energy package, the Polish government should implement its own renewable energy target and tap into the enormous potential of energy efficiency,” he said.

The Warsaw meeting will probably talk about ‘clean coal’ technology that has the potential to sharply reduce CO2 emissions from coal-fired power plants. However, the Greenpeace report ‘False Hope’ shows that so-called Carbon Capture and Storage (CCS) is a dangerous distraction. The technology is unproven, contains inherent risks and comes with an enormous price tag. Global greenhouse gas emissions need to start declining in the next seven years and CCS is in no position to play a role in making this happen.

The impacts of coal are not only related to climate change. Coal also pollutes water resources, dirties the air and causes black lung disease. The report contains ‘on the ground’ stories from 12 countries that describe, for example, how human rights are violated in Colombia while mining coal, how mountain tops are blown apart in the United States and how coal use adds dramatically to air pollution in China.

Source

Low Concentrations Of Pesticides Can Become Toxic Mixture For Amphibians

November 18, 2008

Ten of the world’s most popular pesticides can decimate amphibian populations when mixed together even if the concentration of the individual chemicals are within limits considered safe, according to University of Pittsburgh research.

Such “cocktails of contaminants” are frequently detected in nature, a new paper notes, and the Pitt findings offer the first illustration of how a large mixture of pesticides can adversely affect the environment.

Study author Rick Relyea, an associate professor of biological sciences in Pitt’s School of Arts and Sciences, exposed gray tree frog and leopard frog tadpoles to small amounts of the 10 pesticides that are widely used throughout the world. Relyea selected five insecticides-carbaryl, chlorpyrifos, diazinon, endosulfan, and malathion-and five herbicides-acetochlor, atrazine, glyphosate, metolachlor, and 2,4-D. He administered the following doses: each of the pesticides alone, the insecticides combined, a mix of the five herbicides, or all 10 of the poisons.

Relyea found that a mixture of all 10 chemicals killed 99 percent of leopard frog tadpoles as did the insecticide-only mixture; the herbicide mixture had no effect on the tadpoles. While leopard frogs perished, gray tree frogs did not succumb to the poisons and instead flourished in the absence of leopard frog competitors.

Relyea also discovered that endosulfan-a neurotoxin banned in several nations but still used extensively in U.S. agriculture-is inordinately deadly to leopard frog tadpoles. By itself, the chemical caused 84 percent of the leopard frogs to die. This lethality was previously unknown because current regulations from the U.S. Environmental Protection Agency (EPA) do not require amphibian testing, Relyea said. His results showed that endosulfan was not only highly toxic to leopard frogs, but also that it served as the linchpin of the pesticide mixture that eliminated the bulk of leopard frog tadpoles.

“Endosulfan appears to be about 1,000-times more lethal to amphibians than other pesticides that we have examined,” Relyea said. “Unfortunately, pesticide regulations do not require amphibian testing, so very little is known about endosulfan’s impact on amphibians, despite being sprayed in the environment for more than five decades.”

For most of the pesticides, the concentration Relyea administered (2 to 16 parts per billion) was far below the human-lifetime-exposure levels set by the EPA and also fell short of the maximum concentrations detected in natural bodies of water. But the research suggests that these low concentrations-which can travel easily by water and, particularly, wind-can combine into one toxic mixture. In the published paper, Relyea points out that declining amphibian populations have been recorded in pristine areas far downwind from areas of active pesticide use, and he suggests that the chemical cocktail he describes could be a culprit.

The results of this study build on a nine-year effort by Relyea to understand potential links between the global decline in amphibians, routine pesticide use, and the possible threat to humans in the future. Amphibians are considered an environmental indicator species because of their unique sensitivity to pollutants. Their demise from pesticide overexposure could foreshadow the fate of less sensitive animals, Relyea said. Leopard frogs, in particular, are vulnerable to contamination; once plentiful across North America, including Pennsylvania, their population has declined in recent years as pollution and deforestation have increased.

Relyea published a paper in the Oct. 1 edition of “Ecological Applications” reporting that gradual amounts of malathion-the most popular insecticide in the United States-that were too small to directly kill developing leopard frog tadpoles instead sparked a biological chain of events that deprived them of their primary food source. As a result, nearly half the tadpoles in the experiment did not reach maturity and would have died in nature.

Source

The cost of pollutions is definitely in the trillions.

Of course I don’t think anyone has ever added up the total cost planet wise.

The above is just a couple of estimates from a few places.

One has to think of the planet as a whole. The cost is horrendous.

Cleaning up after it is extremely costly.

The cost to health care is staggering.

The cost of lives lost because of it cannot be calculated.

Well you can’t put a price tag on someones life.

How much is your life worth?

Think about it.

Pollution Reports including Top 100 Corporate Air Polluters 2007 in US

War “Pollution” Equals Millions of Deaths

UK Government ‘ignored Iceland warning’/ Charities may lose

Charities’ fear over failed banks

UK charities say they fear they have lost up to £120 million of funds invested in collapsed Icelandic banks.

UK charities fear they may have lost up to £120m of funds invested in failed Icelandic banks.

The National Council for Voluntary Organisations says at least 60 members have reported funds may be at risk.

The NCVO has met ministers, who are promising to do all they can to protect an estimated £1bn held by charities, UK councils and other bodies in Iceland.

A Treasury delegation is in Reykjavik and the UK and Iceland say they will now work together for a solution.

The group includes officials from the Bank of England and the Financial Services Authority.

‘Disconcerting remarks’

The crisis sparked a war of words between London and Reykjavik on Thursday, with Gordon Brown criticising the Icelandic authorities for failing to guarantee UK depositors would get their money back.

Under Iceland’s financial regulations, the government is supposed to pay up to £16,000 compensation per account at a total cost of £2.2bn.

A spokesman for Mr Brown said the UK now hoped to work “constructively and co-operatively” with the Icelandic authorities.

Icelandic Prime Minister Geir Haarde had accused the UK of being responsible for the collapse of the country’s third largest bank, Kaupthing, after anti-terrorism laws were used to freeze assets in the UK.  (Like Iceland is a terrorist.)

Iceland’s Prime Minister Geir Haarde said he had received a letter from Gordon Brown

On Friday, Mr Haarde confirmed both countries were working together but said Mr Brown’s comments had been “disconcerting” and “not very helpful”.

Meanwhile, the UK government has denied claims of “complacency” after it apparently ignored warnings in July about Icelandic banks facing collapse.

Lib Dem peer Lord Oakeshott and Tory MP Michael Fallon both raised the issue with ministers on separate occasions.

They were reassured savers would be protected by law.

A Treasury spokesman said: “As the minister made clear at the time, the Icelandic authorities have a legal obligation to pay out depositors under their existing compensation scheme and we expect them to honour this commitment.”

He added it was not the role of the UK government to advise UK residents and citizens of financial institutions around the world, and few people had anticipated the current situation.

Chancellor Alistair Darling, who is in Washington for meetings with other G7 finance ministers and the International Monetary Fund, told the BBC that simply “talking” would not lead to a solution.

‘Uncertain position’

Meanwhile, as details of charity deposits emerged, a cancer hospital in Manchester has announced it was the latest victim of the Icelandic bank collapse.

The Christie NHS Foundation Trust, based in Withington is facing losses of £7.5m after depositing the funds with Kaupthing Singer and Friedlander. Up to £6.5m was charity money.

The Cats Protection League said it also had £11.2m deposited in a UK bank owned by the collapsed Kaupthing.
NCVO said City Minister Paul Myners had given no guarantees during their meeting that such assets would be secure, although he was “reassuring”.

Chief executive Stuart Etherington said: “He was saying the government would do all it can to ensure the assets of these charities are reunited with them. He was very positive about that.

“What’s important is the charities which have been affected by this come forward. If we’re going to secure adequate compensation for them, with the strength of the UK government, it’s important they come forward.”

Some NCVO members which provide services for councils fear they will not be paid if town halls lose money in the crisis.

Most of the charities which have investments in troubled Icelandic banks have not yet been named, but they are thought to include major organisations.

Other charities known to be affected include Naomi House children’s hospice in Sutton Scotney, near Winchester, which has £5.7m of deposits invested with KSF

The Physiological Society in London has £523,000 invested with the same bank, and Samaritans has links to KSF because it is the parent company of Investment Managers, which looks after the charity’s investment portfolio.

Graham McGeown, of the Physiological Society, said: “This is a difficult time for our organisation. We have £523k tied up in KSF and are not entirely sure if we will get this money back.

“With NCVO we are calling on the government to help protect our money as well as other organisations who may also be involved in the banking crisis.” Under the Financial Services Compensation Scheme, charities classified as small businesses are covered for the first £50,000 of any investments.

But it is not clear whether they would benefit from the wider guarantee given to individual savers by the chancellor that they would recover all of their money.

The NCVO’s head of campaigns and communications, Louis High, said many of its members were also concerned about local authorities’ ability to pay for services.

He said: “For many smaller organisations that rely on this money and have tight financial constraints, non-payment for their work could be disastrous or even spell their death knell.”

The organisation has called a sector-wide summit to examine the potential impact of a recession and what can be done to protect charities from financial disaster.

UK ‘ignored Iceland warning’

The government has been accused of “complacency” after it apparently ignored warnings in July about Icelandic banks facing collapse.

Lib Dem peer Lord Oakeshott and Tory MP Michael Fallon both raised the issue with ministers on separate occasions.

They were reassured savers would be protected by law.

The Treasury said it was not the government’s role to advise savers and ministers had stressed Iceland had a legal obligation to pay compensation.

Lord Oakeshott said: “Alarm bells were ringing all over about the Icelandic banks and the Treasury must have been blind and deaf not to hear them.”

But a Treasury spokesman said: “As the minister made clear at the time, the Icelandic authorities have a legal obligation to pay out depositors under their existing compensation scheme and we expect them to honour this commitment.”

He said a government delegation was now in Iceland to find a solution to the current situation.

“This is part of the action the Treasury is taking action to ensure the interests of all retail depositors are safeguarded and that legal obligations to UK creditors are honoured.”

Prime Minister Gordon Brown reacted with anger on Thursday after the Icelandic government refused to guarantee the deposits of UK citizens with money in three of its biggest banks, following their collapse.

Crisis talks

Under Iceland’s financial regulations, the government is supposed to pay up to £16,000 compensation per account at a total cost of £2.2bn.

Mr Brown is angry as the UK has received no assurances from the Icelandic government that they will meet this commitment. Treasury officials have travelled to Iceland for crisis talks on repayment.

Lord Oakeshott, a pension fund manager and former director of Warburg Investment Management, raised the alarm about possible shortfalls in the compensation funds – and the danger of an Icelandic bank collapse – in written questions more than two months ago.

In the first question, he asked how much cash was in the Icelandic compensation fund and if Britain would be left to pick up the bill if there was a shortfall.

He was told by Treasury minister Lord Davies that the liabilities of the UK’s Financial Services Compensation Scheme would be limited to “topping-up” funds provided by the country in which the bank is based.

In a second question, he asked: “What steps [have] the United Kingdom financial authorities taken to satisfy themselves, independently of the Icelandic financial authorities, of the solvency and stability of Icelandic banks taking deposits in the United Kingdom and of that of the Icelandic Deposit Guarantees and Investor-Compensation Scheme behind which the United Kingdom Financial Services Compensation Scheme stands as guarantor of last resort?”

Lord Davies, for the government, replied that there was no concern about the liquidity or capital base of Icelandic banks operating in the UK: “All UK-incorporated subsidiaries of Icelandic banks regulated by the Financial Services Authority continue to meet threshold conditions.”

Some banks had been allowed to open branches in the UK through a process known as “passporting,” which meant they were not regulated by the FSA, explained Lord Davies.

But he added: “The FSA has a regular dialogue with overseas regulators and firms where the firms passport into the UK, to share information about the firms and specifically their UK operations.”

‘Sky high rates’

He also assured UK citizens with money in Icelandic banks that they would be “protected against any losses in a similar way as if their savings were in a British bank”.

On Monday, Lord Oakeshott again quizzed Lord Davies about how much money was in the Icelandic compensation fund and what would happen if it “cannot or will not pay out”.

He told peers: “If my cash were in an Icelandic bank I would be very worried indeed: the currency has collapsed, interest rates are sky high and bank liabilities are hundreds of thousands of pounds for each Icelandic citizen. Would the minister be happy if his savings were in an Icelandic bank?”

In contrast to the lengthy and detailed reply he had given in July, Lord Davies said he had not been “fully briefed” on the situation in Iceland.

“It is not for me at the dispatch box to judge whether it is safe to invest in Icelandic banks,” he told peers.

“However, the safeguarding of their position will depend on co-ordinated action in which this country must play a leading role.”

Speaking earlier on Friday, Lord Oakeshott accused the government and the FSA of ignoring the growing warnings from the City about the position of Icelandic banks, one of which, Icesave, had deposits that were almost the equivalent of Iceland’s entire GDP.

“I asked these various, very hard questions and I got a very complacent answer back from the treasury minister, he told the BBC News Channel, adding he had been alerted to problems in Iceland by credit rating agencies, which had downgraded the country’s banks.

“The Financial Services Authority is responsible for the security of British savers’ money. They should not have trusted the Icelandic banks to look after £5bn of their money,” he added.

Minister grilled

The peer said that together with Lib Dem Treasury spokesman Vince Cable, he had put his concerns about the Icelandic banks to the new head of the FSA, Lord Turner, in an hour long meeting on Tuesday, adding Lord Turner had been “very receptive”.

Concerns were also raised in July by the Conservative deputy chairman of the Treasury Select Committee, Michael Fallon, who asked junior Treasury minister Kitty Ussher how much money was in the compensation fund, after press reports there was a shortfall.

Ms Ussher told him: “I do not have figures for the Icelandic compensation scheme.”

Mr Fallon then asked if she was satisfied that British investors in Icelandic banks are fully guaranteed in the event of a bank collapse.

Ms Ussher replied: “I am satisfied that the law exists to guarantee them, yes.”

Mr Fallon: “You are satisfied that the law exists to guarantee them?”

Ms Ussher: “Yes, under a combination of European and British law.”

Mr Fallon: “So they will get all their money back?”

Ms Ussher: “That is the legal situation.”

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Published in: on October 11, 2008 at 5:51 am  Comments Off on UK Government ‘ignored Iceland warning’/ Charities may lose  
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