Miliband gives out weak bank prescription

Mr Miliband attacked "casino banking" but failed to demand extensive long-term public ownership of the banks.

Instead he urged "a more responsible banking system to serve a more responsible capitalism."

The Labour leader chose to deliver his speech at a Co-operative Bank in London, and he did call for an expansion of the mutual sector, noting that the Co-op had seen a 25 per cent rise in applications for accounts last week.

He also pressed the case for a new government-backed British Investment Bank to help finance small businesses.

Mr Miliband suggested that an ordinary bank employee should sit on every bank remuneration committee to help challenge the bonus culture which had enabled Barclays ex-boss Bob Diamond to scoop up £120 million over just five years.

Criminal penalties must be applied to bankers who swindled millions on the financial markets, he added.

But the main thrust of his speech was for more competition between private banks, so that the word banker "goes back to being a compliment rather than a term of abuse."

He proclaimed: "We should break the dominance of the big five banks."

Then he added rather feebly: "Let's turn five into at least seven so there is proper choice for the consumer."

Mr Miliband set out his ideal of "stewardship banking," where banking was a trusted profession not a "fly-by-night activity."

Left Labour MP Jeremy Corbyn commented: "I'm pleased that Ed is talking about banks, and I welcome his support for the Co-op and mutuals, which is the fastest growing part of the banking sector.

"But I wish he would also talk about the need for public control and ownership of the banks."

Communist Party economic committee member John Foster declared: "Ed Miliband"s call for more private-sector banks is politically and economically wrong at a time when there is a crying need for public ownership of retail banks.

"Why is he taking this line? The only explanation would seem to be his fear of challenging the competition rules of the EU, which has already laid down a timetable for privatisation of public-sector holdings in Lloyds and RBS."

rogerbagley@peoples-press.com