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3 July 2012

Bob Diamond’s resignation is a victory for Ed Miliband

Once again, the Labour leader set the political pace.

By George Eaton

Bob Diamond’s resignation, announced this morning by Barclays, is a significant victory for Ed Miliband. Alone among senior politicians, the Labour leader called for the Barclays chief executive to resign the day after the Libor scandal broke (a call he repeated yesterday), with David Cameron merely stating that he had “serious questions to answer“.

“It is not for prime ministers to hire and fire bank chiefs,” said Cameron. “He has to make himself accountable to his shareholders and this House. He has some serious questions to answer.” As in the case of the phone hacking-scandal (when he called for Rebekah Brooks’s resignation and the abandonment of the BSkyB bid) and Stephen Hester’s bonus, Miliband set the political pace. Even Vince Cable, who might have been expected to call for Diamond’s resignation, suggested that it was up to Barclays shareholders to remove him. But in his resignation statement, it was “external pressure” (Miliband, in other words) that Diamond blamed.

One indicator of how seriously the Barclays boss took the Labour leader’s opinion is that he called him last Thursday in an attempt to give his “side of the story” (as Miliband put it). Miliband was initially unsure whether to call for Diamond to go, preferring to focus on the sins of the banking system, rather than one individual, but he eventually resolved that Barclays needed new leadership. At this point, Diamond probably knew that his time was up.

Update: Miliband has responded to Diamond’s resignation, stating that it was “necessary and right”, while repeating his call for a juidical inquiry into the banks. Here’s the statement in full:

This was necessary and right.

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THANK YOU

It was clear Bob Diamond was not the man to lead the change that Barclays needed.

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But this is about more than one man.

This is about the culture and practices of the entire banking system which is why we need an independent, open, judge-led, public inquiry.