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Ed Balls backs calls for Leveson-style banking inquiry Ed Balls backs calls for Leveson-style banking inquiry
(40 minutes later)
Shadow chancellor Ed Balls has thrown his weight behind calls for an independent inquiry into the culture of "lying" in UK banks.Shadow chancellor Ed Balls has thrown his weight behind calls for an independent inquiry into the culture of "lying" in UK banks.
He said that, in retrospect, Labour had not been tough enough on the banks.He said that, in retrospect, Labour had not been tough enough on the banks.
But people had been shocked by the "swaggering arrogance" that had come to light in the past 24 hours.But people had been shocked by the "swaggering arrogance" that had come to light in the past 24 hours.
The Lib Dems, Tory backbenchers and the TUC have also called for a Leveson-style probe - but the Treasury and the Bank of England have rejected the idea. Tory backbenchers and the TUC have also called for a Leveson-style probe - but the Treasury and the Bank of England have rejected the idea.
Mr Balls, who as Labour's City minister championed "light touch" regulation, said only an "arm's-length" inquiry would get to the bottom of bad regulation that he said dated back to the 1980s.Mr Balls, who as Labour's City minister championed "light touch" regulation, said only an "arm's-length" inquiry would get to the bottom of bad regulation that he said dated back to the 1980s.
He told the BBC News channel that it was the "culture of lying" in banks as much as the regulatory framework that needed to change - and there was now a case for a full public inquiry.He told the BBC News channel that it was the "culture of lying" in banks as much as the regulatory framework that needed to change - and there was now a case for a full public inquiry.
'Culture change'
He said: "We can't just brush this under the carpet. People are shocked by the swaggering arrogance of what we discovered in the last 24 hours, and I think we need to open this wide open."He said: "We can't just brush this under the carpet. People are shocked by the swaggering arrogance of what we discovered in the last 24 hours, and I think we need to open this wide open."
His comments follow the Financial Services Authority's decision to fine Barclays £290m for trying to manipulate a key bank interest rate and revelations that banks mis-sold specialist insurance tied to thousands of small businesses.His comments follow the Financial Services Authority's decision to fine Barclays £290m for trying to manipulate a key bank interest rate and revelations that banks mis-sold specialist insurance tied to thousands of small businesses.
Some MPs have called for Barclays' chief executive Bob Diamond to resign and Mr Balls said he was unsure whether the current leadership "could take the bank forward".Some MPs have called for Barclays' chief executive Bob Diamond to resign and Mr Balls said he was unsure whether the current leadership "could take the bank forward".
David Cameron has said the bank's management faces "serious questions". Bank of England Governor Sir Mervyn King said Britain's banks needed a "real change in culture" but ruled out a wider inquiry.
Bank of England Governor Sir Mervyn King said Britain's banks needed a "real change in culture" but ruled out a wider inquiry, and the Treasury said "action not words" was what was needed. David Cameron supported his comments saying action on accountability, regulation, transparency and behaviour was what was needed.
He said: "We know what needs to be done so let's get on and take those actions."
"I think the most important thing people want to see is a really concrete set of actions that will help change the culture.
"You don't change culture by changing laws and changing regulators alone but I think if we can do this in a very clear and considered way then we have a chance of getting this right," he added.
Business Secretary Vince Cable told BBC News he did not have "any strong objection" to an independent inquiry but added "I'm not sure how it helps".
He said the problems within the industry were known and the public and the business community wanted the government to "get on and make our banking system stable".
'Fundamental dishonesty''Fundamental dishonesty'
A petition on the government's e-petition website calling for a judicial public inquiry into the wrongdoing and ethics of bankers, with "full powers to compel witnesses to appear on oath, and to obtain all forms of evidence" has received more than 4,000 signatures.A petition on the government's e-petition website calling for a judicial public inquiry into the wrongdoing and ethics of bankers, with "full powers to compel witnesses to appear on oath, and to obtain all forms of evidence" has received more than 4,000 signatures.
Lib Dem backbench Treasury spokesman Stephen Williams backed calls for a Leveson-style inquiry.Lib Dem backbench Treasury spokesman Stephen Williams backed calls for a Leveson-style inquiry.
And Mark Garnier, a Conservative member of the Treasury Select Committee, said a process in which banks were "pulled over the coals" would address public fears.And Mark Garnier, a Conservative member of the Treasury Select Committee, said a process in which banks were "pulled over the coals" would address public fears.
He said the levelling of the fine on Barclays was a "game-changing moment" because it showed "fundamental dishonesty and systemic and institutionalised behaviour".He said the levelling of the fine on Barclays was a "game-changing moment" because it showed "fundamental dishonesty and systemic and institutionalised behaviour".
Lord Justice Leveson is carrying out an inquiry, which has already lasted more than 12 months, into the culture, practices and ethics of the media following the phone-hacking scandal.Lord Justice Leveson is carrying out an inquiry, which has already lasted more than 12 months, into the culture, practices and ethics of the media following the phone-hacking scandal.
During the course of the inquiry, new evidence has come to light and witnesses, who have included journalists, top politicians and victims of phone hacking, have been subject to lengthy and detailed questioning by a barrister.During the course of the inquiry, new evidence has come to light and witnesses, who have included journalists, top politicians and victims of phone hacking, have been subject to lengthy and detailed questioning by a barrister.
But Treasury Minister Mark Hoban told BBC News there had already been a number of inquiries into the banking sector.But Treasury Minister Mark Hoban told BBC News there had already been a number of inquiries into the banking sector.
"I think what households, taxpayers and businesses want to see is action not words and we're taking the tough action that's needed to get the regulation right and help change the culture of banking in this country," he said."I think what households, taxpayers and businesses want to see is action not words and we're taking the tough action that's needed to get the regulation right and help change the culture of banking in this country," he said.