The press is awash with banker-bashing this morning as news filtered through late last night that the Barclays chairman, Marcus Agius, had announced his resignation. In a sombre statement on the beleaguered bank’s website, Agius stated that he was ‘truly sorry’ for the rate-rigging scandal that has dealt a ‘devastating blow’ to the bank’s reputation. This act of self-sacrifice is unlikely to puncture the political pressure on the bank with the Labour leader, Ed Miliband, touring the studios calling on the bank’s chief executive, Bob Diamond, to quit. Indeed, the Miliband has echoed his surefooted response to the hacking scandal by taking the lead in forcing the government to establish a Leveson-style inquiry into the Barclays behaviour. It is thought that Labour will put down an amendment in parliament this week, further piling the pressure ahead of this week’s showcase parliamentary event on Wednesday.
Diamond will be hauled in front of the Treasury select committee on Wednesday to explain his role in the Libor scandal. The session promises to be a more humbling affair than his last, when he told MPs that the ‘time for remorse is over’. Diamond, one would hope, will be a touch more remorseful this week as he fights for his very survival. The tone has already been set by Andrew Tyrie, chair of the Treasury select committee, who told the House last week that he believed Barclays had lied. It’s an electric statement to make; to accuse the world’s fourth largest bank with a charge sheet of institutional lies that rigged the international bank rate. It does, though, beggar belief that presciently around the time £300bn of taxpayers’ money was being pumped into British banks to keep them afloat, sections of it were allegedly colluding with each other to distort markets and defraud the very public who had saved their industry.
The Conservatives, for their part, will seek to smear the Labour party with the bank’s present difficulties. Their line is clear, as George Osborne told the House last week: ‘He (Ed Balls) was there every single day while these abuses were taking place as the City minister responsible for regulating Barclays and other banks at the time’. The honest truth is that neither party can come out of this scandal clean. Labour were in power during the 13 years when the City boomed and malpractice was allowed to fester, while all the Conservatives ever did was call for less regulation. Pat McFadden, on these very pages, has called for a ‘Clause IV moment’ for the banks. And how right too; but a deep cynic sees no end to the immunity – moral, political, fiscal and possibly legal – claimed by our bankers.
Away from the latest scandal of British banking, on Tuesday the international development committee opens its future of Afghanistan inquiry. Given that three British troops were shot dead by an Afghan policeman yesterday, the committee is timely and will be asking searching questions about progress in Afghanistan since 2007 and the nation’s security prospects once Nato hands responsibility over to Afghan forces post 2014.
It is unlikely that Miliband, in his tenacious efforts, will find the smoking gun that will fundamentally alter the culture of British banking. But his rhetoric has tapped into the widespread disgust. His call for ‘the strongest punishment’ for wayward bankers is brave, and is in marked contrast to not a peep from our prime minister. As with the hacking scandal, the culture of dishonesty from employees is largely governed by signals from their masters. The fish, after all, rots from the head.
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David Talbot is a political consultant, tweets @_davetalbot and writes the weekly The Week Ahead column on Progress
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