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Shadow Chancellor Ed Balls told BBC1's Andrew Marr Show that the banking sector need a "root and branch review" and said the Government was "dragging their feet." He said:
"There's no proper code of conduct. It's not enforced. Bankers can do what they get away with."
He also said it would be "outrageous" if Bob Diamond received a severance package worth £17 million.
The banking sector is the industry most in need of greater regulation, according to a global consumer survey published in the wake of the rate-rigging affair.
A 24-country study by Ipsos-MORI found that 37% of consumers around the world believe that the banking sector has "too little" regulation.
- 68% of Britons say there is too little regulation
- 51% of global consumers say that they want more "operating transparency" in the sector
Labour leader Ed Miliband is to reveal his plan to overhaul the UK banking sector in a speech tomorrow. He outlined some of his ideas in an interview with The Mail on Sunday:
- Britain's five high street banks to be broken up and forced to sell 1,000 branches
- This would pave the way for two new privately run 'Challenger Banks' that would offer extra choice
- A new regulatory body should be set up withing the banking industry with a strict code of conduct
- The Serious Fraud Office should have their resources increased: this would be funded by fines levied on wayward banks
- New 'transparency' rules should force banks to reveal who they lend money to
Labour leader Ed Miliband is calling for a "revolution in British banking" and demanding that high street banks sell off 1,000 local branches and that the big five banks become seven. In an interview with the Mail on Sunday Miliband said:
"Bankers should be struck off if they do the wrong thing and never allowed to work in the industry again"
He said banks should be forced to help small businesses and to stop using language that confuses the public:
"‘You can use lots of fancy, schmantzy words but the fundamental point is the economy hasn’t been working for most working people but for a few at the top. It wasn’t just true under the Tories, it was true under the Labour Government towards the end as well.’