Shadow Treasury Minister Lord Eatwell told peers today that while a banking inquiry led by the chairman of the House of Commons Treasury Committee had "a contribution to make" its terms were "too narrowly drawn".
Lord Eatwell said a public inquiry "may lead to some criticism of the policies adopted by previous governments, including governments formed by my party" but called for peers to back it:
They have their particular contribution to make, but the financial services industry is too big, too complex too far-reaching and too important for there not to be a full independent judicial inquiry as is proposed in this amendment.
The Government and Labour clash over the scale of inquiry into the banking scandal. Labour want a full, independent one.
The new government inquiry will look both into the culture of banking and into the setting of Libor rates
The Chancellor's team says his announcement to the Commons will "shoot Labour's fox."