Banking Reform

Click here to see Jonathan attacking UK Government on banking regulation reform (16/06/2011)

I believe that the light touch regulatory approach to the financial sector pursued by both New Labour and the Tories has failed. Such was the systemic failure of the banking system, taxpayers have been forced to fund a bailout of over £1.3 trillion in loans, grant and guarantees. It is estimated that this will cost each family £40,000.

Labour’s approach has been to revert to business as usual for the square mile. I consider their approach reckless and irresponsible. If elected I will campaign for:

  • The need to divorce commercial and investment banking so that no longer can the casino bankers and speculators act with impunity – an end to so called ‘moral hazard’.
  • Develop the growth of the mutual financial sector so that companies are motivated by other values other than the relentless search for profits.
  • A long term 10% Corporate Social Responsibility (CSR) levy on banking profits to pay for an economic development fund for the UKs poorest areas, such as Carmarthenshire. The CSR levy which will generate between £2bn and £6bn a year in revenue will also be used to fund acute and preventative money advice services provided by trusted 3rd Sector organisations such as the CAB, and finance Credit Unions.
  • A borrowing cap on mortgage payments of 3 times income in order to avoid yet another unsustainable housing price bubble
  • A change in the calculi for interest rates from the Consumer Price Index to a formula that includes house price inflation