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| Version 2 | Version 3 |
|---|---|
| City has a great future - Brown | City has a great future - Brown |
| (about 1 hour later) | |
| The City of London has a "great future" despite the current world economic crisis, Gordon Brown has said. | The City of London has a "great future" despite the current world economic crisis, Gordon Brown has said. |
| The prime minister told BBC Radio 2's Jeremy Vine Show that the financial sector would be "renewed" by changes being made to banking regulation. | The prime minister told BBC Radio 2's Jeremy Vine Show that the financial sector would be "renewed" by changes being made to banking regulation. |
| Mr Brown also said the government had "assured" the future of the system by investing billions of pounds in it. | Mr Brown also said the government had "assured" the future of the system by investing billions of pounds in it. |
| But the Conservatives have warned that there is a danger of creating banks which are "too big to fail". | But the Conservatives have warned that there is a danger of creating banks which are "too big to fail". |
| Several large banks have reported massive losses in recent months, as the effects of the credit crunch continue. | Several large banks have reported massive losses in recent months, as the effects of the credit crunch continue. |
| 'Power cut' | 'Power cut' |
| The government has bought large parts of Royal Bank of Scotland and HBOS and nationalised Northern Rock and Bradford and Bingley in an effort to prevent the collapse of the system. | The government has bought large parts of Royal Bank of Scotland and HBOS and nationalised Northern Rock and Bradford and Bingley in an effort to prevent the collapse of the system. |
| During his question and answer session with Radio 2 listeners, Mr Brown said: "The banking system had what is the equivalent to a power cut." | During his question and answer session with Radio 2 listeners, Mr Brown said: "The banking system had what is the equivalent to a power cut." |
| He added that it was the "right thing to do" to invest in overcoming this, adding: "We are making the right decisions to invest for the future... | He added that it was the "right thing to do" to invest in overcoming this, adding: "We are making the right decisions to invest for the future... |
| "We have taken shares of the banks. We have now assured the [future of the] banks." | "We have taken shares of the banks. We have now assured the [future of the] banks." |
| Mr Brown said the government had moved to ensure banks free up £50bn more in lending to customers and businesses. | Mr Brown said the government had moved to ensure banks free up £50bn more in lending to customers and businesses. |
| We now have the makings of a proper global financial system Gordon Brown, prime minister City has a great future - Brown | |
| Pressed on whether he was personally responsible for the banking crisis in the UK after presiding over a "light touch" regulatory regime when he was chancellor and lauding financial innovation and "creativity" in the City, he insisted it was a global problem. | Pressed on whether he was personally responsible for the banking crisis in the UK after presiding over a "light touch" regulatory regime when he was chancellor and lauding financial innovation and "creativity" in the City, he insisted it was a global problem. |
| But he said: "The City of London has a great future and will be renewed with proper changes in the way it is organised to accommodate itself to world conditions." | |
| The government's temporary reduction of VAT from 17.5% to 15% would ensure "people will not get more in their pocket at the end of the month". | The government's temporary reduction of VAT from 17.5% to 15% would ensure "people will not get more in their pocket at the end of the month". |
| Resignation call | |
| A caller then said Mr Brown should admit responsibility for the crisis and demanded he resign. | |
| Mr Brown said: "Well, first of all I am responsible, secondly I have got a job to do and the job I have got to do is take us through this difficult economic situation, which I think you would accept is global and not just a British situation." | |
| Asked if he was looking at help for savers in the upcoming Budget, Mr Brown said: "Help for savers is something that we are looking at in the Budget. You have got to remember that the worst thing that could happen to savers is inflation got out of control and savings were eroded. | |
| "But I accept that interest rates are low and therefore the return on savings are low and we are looking at that as well." | |
| He claimed Britain's debt levels were lower than America, Germany, France, Japan and Italy and that the country was not "badly exposed" as a result of an over-reliance on financial services and said he had warned for years about the financial crisis in speeches. | |
| "I kept saying we have got to build a proper supervision system for the global economy. I made speeches in 1997, 1998, 1999. I tried to persuade other people but after the Asian crisis people said 'Well, things are back to normal.' | |
| "Now we are making these changes, and we agreed a lot of them last week as a result of the crisis itself and so we now have the makings of a proper global financial system." | |
| Tighter regulation | |
| World leaders agreed a new global financial regulatory system at last week's G20 summit, although the reforms did not go as far as some countries would have liked. | |
| The UK government has also tightened up regulation of the banking sector at home. | |
| But Conservative leader David Cameron has said only his party can clean-up the City and have pledged to change the culture of Britain's banks and restore the Bank of England's power to oversee levels of debt. | |
| Shadow chancellor George Osborne has, meanwhile, suggested a Tory government would break up the banks bailed out by taxpayers when they are sold back to the markets, to prevent them threatening future stability. |