Liberal Democrat leader and deputy prime minister Nick Clegg has stated that the 2019 deadline for banking reforms which will safeguard taxpayers against another bailout was just a “backstop date.”
Though this date was recommended by Sir John Vickers’ Independent Commission on Banking, Clegg says they could be implemented “well before 2019.”
The Independent Commission’s report was published earlier this month and included the suggestion that banks “ringfence” their commercial sectors away from their riskier investment sectors in order to avoid another banking bust.
However, bankers were in an outrage over the proposed reforms, saying that the current state of the economy left no room for extra burdens on banks. The Commission gave banks until 2019 for ringfencing and other reforms to take place.
To the dismay of financial institutions, Clegg has said he is “pretty confident” that reforms can be implemented far sooner. He said that he wanted the legislation for bank reform to come about “as quickly as possible,” despite bank resistance.
‘As quickly as possible’
Clegg’s claims that “As long as we legislate during this parliament I suspect, actually, the changes will be implemented well before 2019” seem to contract recent statements by David Cameron.
The prime minister recently stated that the 2019 deadline is recommended so that UK reforms can coincide with the deadline for new international capital standards.
Still, Clegg says that the government will “legislate in full” these reforms by the end of parliament.
He also expressed the Liberal Democrat agenda to make changes in the way banks are run, an issue which includes pay and bonuses. Clegg has previously stated he feels bank bonuses are “gratuitously offensive.”
Speaking on the banking reforms, Clegg said, “”I think all of us at the top of government, including the chancellor, would like to see this done as quickly as possible.”