The only way to make sure that casino bankers are never able to gamble with taxpayers’ money again is to split the retail and investment arms of banking, and to break up of super banks, Plaid Cymru’s Treasury spokesperson Jonathan Edwards MP said yesterday.
Mr Edwards was responding to the first findings of the Independent Commission on Banking interim report published today. The Commission was set up to review the UK banks following the crisis – but the UK Government has no obligation to implemented them.
Plaid Cymru has long argued that reform of the banking sector is overdue and that fairness should be at the heart of the financial sector. Plaid favours dividing the two arms of banking, commercial and retail, known as a ‘Glass-Steagal’ separation after the original American Act in the 1930s, and a strategy to break up large banking monopolies.
Mr Edwards said:
“Governments across the world have bankrolled the whole financial system and yet just a few years later, these same speculators and spivs are already holding the same governments to ransom in the case of some of Eurozone countries.
“Instead of tinkering around the edges, which is what today’s proposals suggest, we must ensure that history is never repeated.
“Banks must not be allowed to gamble with people’s money in the reckless way which they have in the past – and still want to do in the future.
“It is disgusting that the bankers have already gone back to their bad old ways, enjoying a whopping £7billion bonus season this year already – all because they still operate on this basis of tomorrow’s profit first rather than long term planning.
“The only way to safeguard taxpayers from bankrolling casino bankers – is to split the two arms of banking, retail and investment.
“This would mean that people’s savings would be protected, while those who place risky bets on the stock market do so without risking our money.
“Banking reform must include a strategy to break up banking monopolies.
“Government and regulators should be working to build a larger market share for mutual financial institutions, reversing decades of Tory and Labour privatisation, to ensure that more of our banks operate on a not for profit model in the interest of customers and not shareholders.
“Taxpayers should never again have to subsidise speculative banking behaviour and this is the only way to save them from such risks.
“This is a once in a lifetime opportunity to ensure that our financial services operate in the interests of the common good ahead of massive profits for the few. The UK Government must toughen up these proposals.”
