The Banks have again taken centre stage over the past couple of weeks, and unfortunately, yet again it is for all the wrong reasons.
The revelations that have been uncovered by the recent FSA investigation are shocking. It is clear that what happened at Barclays, and potentially other banks, was completely unacceptable. It also serves as a further condemnation of the failed tripartite regulatory system that was introduced by the last Government.
Barclays have been fined for the part that they played in this latest scandal; but fining the bank alone will not suffice. The Serious Fraud Office are looking at whether there are any criminal prosecutions that can be brought, and they are using the full force of the law in dealing with this.
Additionally, we must ensure that a similar incident is never allowed to happen again. The new Financial Services Bill will reform the regulatory system from top to bottom and create a tough new Financial Conduct Authority which will have a razor-like focus on market abuse and protecting consumers.
But I believe that more can be done.
That is why I am delighted to welcome the Prime Minister’s announcement of a parliamentary inquiry into the culture and professional standards in the banking industry. The Government will give the inquiry all the resources it needs to do its job properly. It will report by Christmas so its recommendations can be included in the upcoming legislation on banking reform.
What is imperative is that we get to the truth quickly. Labour want to kick this into the long grass; and I can understand why. After all, this latest scandal took place under the last Government, and Labour’s Deputy Chief Whip in the Lords, Lord Tunnicliffe, has admitted that it was the last Labour Government’s “fault”.
We already know what went wrong and I believe that we can’t wait until 2015 or 2016 to fix these problems. We need a new culture of responsibility in banking as soon as possible.
Banking remains one of the most important industries for the whole of the UK economy. In Chester alone we have around 10,000 people working in the financial services industry and its importance should not be overlooked.
But improvements are urgently needed and the Government will take the appropriate action to reform the UK’s financial sector so this can never happen again.