Labour Conference: Ed Miliband Threatens To Break Up Britain's Biggest Banks

Miliband Threatens To Break Up Britain's Banks If They Don't Reform

Ed Miliband has threatened to forcibly break up Britain's biggest banks if they do not go further and faster with reforms designed to avert another crash.

The Labour leader issued the stark warning on the eve of a Labour Party conference at which he is under pressure to set out his alternative to the Conservative/Liberal Democrat coalition.

Under government plans, banks have until 2019 to ring-fence high street operations handling consumer and small business accounts from high-risk "casino" arms within the same group.

But the Opposition accuses Chancellor George Osborne of watering down reforms called for in the Vickers review in the face of lobbying by the industry and moving to slowly to force change.

Mr Miliband - who is using the conference to unveil a series of policies to protect consumers from big business - said a Labour administration would legislate if major changes were not in place by the 2015 general election.

"Either they can do it themselves - which frankly is not what has happened over the past year - or the next Labour government will, by law, break up retail and investment banks," he said.

"The banks and the Government can change direction and say that they are going to implement the spirit and principle of Vickers to the full. That means the hard ring-fence between retail and investment banking. We need real separation, real culture change. Or we will legislate. If they don't do it voluntarily, embrace the change Britain needs, then we are going to have to do it by law."

Labour said that action would be taken unless there was evidence of a cultural change as well as the implementation of the "letter and spirit" of the Vickers report, including splitting staffing and corporate governance.

While the party has been buoyed by consistent double-digit poll leads, the leader is under pressure to improve stubbornly poor personal ratings and faces demands from trade unions to offer more support to public sector workers.

Among policies he has revealed so far are the replacement of Ofgem with an energy regulator which has tougher powers to ensure prices are fair and a cap on pension fund management fees. They were "the opening shots in a war we need to fight to make this economy work for everyone", he said.

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