George Osborne has called on Alistair Darling to consider giving the Bank of England new powers to manage overall debt levels in the economy.
The Shadow Chancellor stressed that we must now start driving forward longer-term changes to our system of regulation to prevent further crises from occurring:
“There will be plenty of time to assess the mistakes that have been made, and how we got into this situation, but one thing is clear: we must ensure that in future that it is banks and their shareholders who put aside capital not the taxpayer.”
George reiterated our support for the bail-out package announced by the Government, but said that it will only be a success when “credit starts flowing through the veins of the economy” again, with banks lending to small businesses and families, not just to each other:
“Let us be clear - we do this not to rescue the banks or the bankers but to rescue the economy and the millions of families who depend on it.”
George repeated David Cameron’s statement that there should be “no rewards for failure”, with no bonuses for those senior executives who “took their banks to the edge of bankruptcy”.
And he asked the Chancellor whether the Government had received a commitment that those banks that are most in need of taxpayer money will not pay bonuses to their senior staff this year.