Miliband urges bankers to change
Published 03/02/2012 | 03:12
Ed Miliband is to warn bankers they must embrace change or face social isolation.
In a speech in London's Canary Wharf financial district on Friday, the Labour leader will urge a return to "one nation banking" to avert economic segregation.
The speech comes at the end of a week of clashes at Westminster over bankers' bonuses and executive pay.
He will tell the bankers in his audience at Thomson Reuters that they must recognise their industry has "reached a crossroads". "Continuing on its current path will lead to further isolation from society, greater public anger, and an economy which does not pay its way in the world," he will say.
He will warn that Britain is in danger of becoming "two nations", socially and economically, and urge the banks to lend more to small businesses to boost growth and jobs.
"One nation banking also recognises that these institutions cannot be isolated from the rest of society - that we are once again at risk of becoming two nations in this country, segregated economically, geographically, and socially," he will say.
"This is not the kind of society in which I want to raise my children. And it is not the kind of society in which the vast majority of people in this country, including bankers, want to raise theirs."
Stephen Hester, chief executive of majority state-owned Royal Bank of Scotland, this week waived his almost £1 million bonus amid intense political pressure. His predecessor Fred Goodwin was stripped of his knighthood in recognition of how much his failed leadership at the bank had cost the taxpayer.
But Mr Miliband will say that all banks - not just those owned by the state - have a responsibility to exercise restraint because they are at least "indirectly" supported by the taxpayer. "All companies must show responsibility but banks have a particular responsibility because they are either directly or indirectly supported by the taxpayer," he will say.
Labour will use an Opposition Day debate in the Commons on Tuesday to hold votes on reintroducing the bank bonus tax and ending bonuses based on "one-way bets".