The week ahead
After Andy Murray was reduced to tears in SW19 yesterday, the drama switches firmly back to SW1 this week with a plethora of parliamentary battles over Lords reform, the EU and the future of British banking. First up is Paul Tucker, the deputy governor of the Bank of England at the centre of email correspondence that threatened, briefly, to ignite the row swirling around Barclays. At 4.30pm this afternoon Tucker will make his way to the Wilson Room in Portcullis House to be cross-examined by the Treasury select committee. One hopes that the phalanx of assorted MPs deliver a rather heartier blow to Tucker than they did to Bob Diamond, the recently departed chief executive of Barclays, last week. Diamond, who never knowingly said anything of note over the near three hours of his hearing, gave a master class in obfuscation. But the past two weeks have been agonising for British banking. The hearing is far more than just about finance. It is about our trust in Britain’s financial institutions, about whether political interference poisoned the well and, frankly, whether certain former Labour ministers had their hands all over the Old Lady on Threadneedle Street.
Ed Balls may have survived George Osborne’s clumsy and desperate attempt to smear him with one of the most pugilistic parliamentary performances seen in quite some time, but if Tucker tells MPs today that, yes, a senior Labour figure did – even covertly – suggest to the Bank of England that Barclays should massage Libor downwards, it could deal a fatal blow to Labour and reinforce the claims of our critics who say the party cannot be trusted on the economy. Therefore the stakes are high for Ed Miliband today as he calls for a banking revolution at a speech to the Cooperative bank. The Barclays scandal has unleashed a fresh wave of anger towards the banks, and the Labour leader will attempt to position himself on the side of consumer as he advocates breaking up the big banks to allow new competitors to flourish.
Battle recommences this week over the draft Lords reform bill as it goes before MPs for what promises to be a fractious few months in the Commons. ‘Tory grandees urge Lords rebellion’ thundered the Sunday Times headline, and it is certainly an issue that rankles with the Tory backbenches. This is a seemingly perennial issue for the Commons – Winston Churchill demanded reform of the second chamber at the turn of the 20th century. All democrats should back Lords reform. A predominantly second elected chamber, with a clearly defined role, would enhance British democracy. A small number of specialist, appointed members should be retained in order to maintain the supremacy of the Commons and uphold the scrutiny it provides. Politicians must ask themselves what a visibly worried electorate, staring at dire financial news, scared of their precarious employment, will think of a government exhausting so much energy on remodelling Westminster. But truly, this is an issue where our MPs must put down the political bluster, swallow their anger and allow the legislation to pass.
Tory irritation will not be confined to the orgy of Clegg-bashing the Lords reform bill will provide. On Thursday the Commons has a debate on the European Union, which is sure to draw the hardline swivel-eyed Tory Eurosceptics out of the woodwork. They will, of course, use it as a chance to keep up the pressure on their leadership on all things European. Meanwhile, we all get on with our lives.
Messrs Miliband and Balls have, thus far, escaped much of the wrath associated with the latest scandal to hit British banking. But a stray word from Tucker this afternoon and all that could change. The issue has the potential to be toxic for Labour, presiding as we did over a largely unchecked City that provided an awful lot of boom and then bust. Balls in particular is universally loathed on the Tory benches. They will relish any opportunity to attack their primary Labour foe in the week ahead.
Bank of England, banking, Barclays, coalition government, Conservatives, Ed Balls, Ed Miliband, euroscepticism, George Osborne, House of Lords reform, Labour, Nick Clegg