Darling to set out plan for a stronger tripartite system
CHANCELLOR Alistair Darling will ignore calls by governor of the Bank of England Mervyn King to give the central bank more powers, in favour of strengthening the current tripartite system, Treasury sources said yesterday.
Darling is expected to lay out his vision for the future of UK financial regulation in a green paper that could be released as early as this week.
The chancellor will adopt the proposals of Financial Services Authority (FSA) chairman Lord Adair Turner’s review of the regulatory system, which envisages a strong FSA and Treasury working alongside the Bank.
The plans will once again cause friction between Darling and King, after the pair issued starkly contrasting speeches to the City at last week’s Mansion House dinner.
While Darling placed the focus on the boardroom culture at financial institutions, King said the Bank needed greater power, likening it to “a church whose congregation attends weddings and burials but ignores the sermons in between”.
Treasury sources said yesterday that the chancellor was unlikely to bow to pressure from King for the Bank to wield greater powers and would opt instead to step up the activities of the FSA.