Blaming the right bankers is too tricky: let's just pick one

Andrew Bailey thinks it "more than odd" that CEOs have avoided blame.

So far, those at the very top of failing banks - chairmen and chief executives -  have for the most part avoided going down with the ship, and today the Prudential Regulation Authority's Andrew Bailey has called them out. It is "more than odd", he said, speaking at a conference in London, that people at the very top of the chain have avoided formal charges while those beneath them shoulder the blame.

It is to my mind a very striking observation and difficulty with the crisis that no formal action has been taken against any chief executive or any chairmen of a failed institution. Not because I have a personal vendetta against them but it is more than odd that action has been taken against people lower down institutions but not at the top.

The explanation he'd been given, Bailey said, was that there was a “problem with the trail of evidence”, which allowed bosses to “delegate responsibility as well as tasks”. This was evidence, he said, of a “flaw in the system” peculiar to banking.

Blaming your juniors is hardly a custom specific to a single industry - but in this case, over misdemeanors that seem to spring directly from company culture,  it seems particularly logical to blame those at the top. (This recently did happen at HBOS - and today Bailey said he "welcomed" Vince Cable's investigatation of a boardroom ban for the "HBOS three" at the top, Lord Stevenson, Sir James Crosby and Andy Hornby.) Follow this logic any further, however, and things start looking a little less clear cut. Here's the FT on some further causes of the collapse of HBOS:

Three accessories after the fact not named in the report are Westminster, the City and the financial press. HBOS’s board were buccaneering heroes to many in the Noughties. Sir James’s New Labour chums secured his knighthood in 2006. Gung ho investors pushed HBOS shares higher between June 2004 and 2007 than any bank stock, Standard Chartered excepted. Business journalists mostly bought the bank’s bullish story, including Lombards past and present.

But if the blame is to be so broadly spread, it becomes meaningless. Blame too few, though, and it becomes scapegoating. Here's Robert Peston:

Here's the thing: if the HBOS troika are to be blacklisted from the City, why not ban those who ran the other failed banks, RBS, Bradford & Bingley and Northern Rock?

The important thing, as Peston points out, is to mete out the cathartic punishment so necessary to the public without damaging banks too much. As the potential for blame stretches to an entire industry and beyond, there will be an element of scapegoating here, and it would be moral to place this scapegoating at the top. But we must be careful not to set off a domino effect - if we blame x - why not blame y? - and risk harming too many powerful players in too many institutions. Perhaps the solution is just to pick one banker and drive them into the wasteland outside the city (hackney marshes/Essex?), and then have done. Suggestions on a post-card.

Photograph: Getty Images
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Angela Rayner - from teenage mum to the woman who could unify Labour

Corbyn-supporting Rayner mentioned Tony Blair in her speech. 

For those at the Labour party conference feeling pessimistic this September, Angela Rayner’s speech on education may be a rare moment of hope. 

Not only did the shadow education secretary capitalise on one of the few issues uniting the party – opposition to grammar schools – and chart a return to left-wing policies, but she did so while paying tribute to the New Labour legacy. 

Rayner grew up on a Stockport council estate, raised by a mother who could not read nor write. She was, she reminded conference, someone who left school a no-hoper. 

"I left school at 16 pregnant and with no qualifications. Some may argue I was not a great role model for young people. The direction of my life was already set.

"But something happened. Labour's Sure Start centres gave me and my friends, and our children, the support we needed to grow and develop."

Rayner has shown complete loyalty to Jeremy Corbyn throughout the summer, taking two briefs in the depopulated shadow cabinet and speaking at his campaign events.

Nevertheless, as someone who practically benefited from Labour’s policies during its time in government, she is unapologetic about its legacy. She even mentioned the unmentionable, declaring: “Tony Blair talked about education, education, education. Theresa May wants segregation, segregation, segregation.”

As for Rayner's policies, a certain amount of realism underpins her rhetoric. She wants to bring back maintenance grants for low-income students, and the Educational Maintenance Allowance for those in further education. 

But she is not just offering a sop to the middle class. A new childcare taskforce will focus on early education, which she describes as “the most effective drivers of social mobility”. 

Rayner pledged to “put as much effort into expanding, technical, vocational education and meaningful apprenticeships, as we did with higher education”. She declared: "The snobbery about vocational education must end."

Tory critics have questioned the ability of a woman who left school at 16 to be an education secretary, Rayner acknowledged. “I may not have a degree - but I have a Masters in real life,” she said. It could have sounded trite, but her speech delivered the goods. Perhaps she will soon earn her PhD in political instincts too.