Darling: preventing further crises
Updated on 08 July 2009
Alistair Darling speaks to Jon Snow about why the banking white paper will safeguard the banking system from further crises.
The chancellor today announced stricter regulation for the banking system to protect the economy from a repeat of the current financial downturn.
Alistair Darling defended the white paper, the first 10 pages of which are devoted to praising the achievements of the City of London.
"Over a million people in this country are employed by the financial services industry... I am not going to get myself in a silly position by somehow saying 'We do not need this industry'.
"This is something where there has been mistakes made, colossal mistakes in some cases. But provided we get the regulatory system right, the provisory system right, we can remain providing financial services across the world and rebuild [the country's economic] reputation."
The chancellor went on to say that the Financial Services Authority (FSA) and other institutions had been given powers to regulate the industry in order to monitor the system in a formalised way.
"The FSA has the power to say whether banks are properly run by people who are properly qualified. One of the new things we are going to do is give the FSA powers so if, for example, they find someone who is the chief risk officer but has no suitable qualifications, they can get them out.
"We have already given the Bank of England greater powers earlier this year. The FSA is already implementing a much tougher regime than it had.
"I outlined today further plans and proposals that will give them tougher powers still.
"It is necessary, at a higher level institutionally, to ensure that when we see the warning signs appearing, that we can actually, in a far more formalised open way, respond to those warnings so people can judge us on judgements we make."
