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By Paul Goodman
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Andrew TyrieAndrew Lilico wrote on this site recently that the Bank of England (inter alia) has examined why the banking crisis happened, so there is no need for a further inquiry to that end.  Eamonn Butler said that blame lies primarily with politicians, not bankers.  Elsewhere, Dan Hodges went on the rampage – arguing like some latter-day Dr Heinz Kiosk that We Are All Guilty: we need, he said, a public inquiry into the culture and ethics of the British public.

The unvarnished political reality is that Mr Hodges's anti-hero, Ed Miliband, had David Cameron's gonads in a vice.   The Labour leader would almost certainly have hived off enough Liberal Democrat and (yes) Conservative defectors to have won a Commons vote to set up a public inquiry into banking, just as he would almost certainly have hived off enough Liberal Democrat and (again) Conservative defectors to have won a Commons vote to set up a public inquiry into the media.  Hence Leveson and all his works.


So the Prime Minister quickly conceded a inquiry wider than one into the Libor scandal alone.  I wrote last Friday that Parliament should take the initiative and set up its own inquiry into the banking scandal.  But the Executive has got there before the Legislature: Mr Cameron wants a quicker inquiry than a judge is likely to deliver, and doubtless calculates in any event that the Leveson circus is rendering judge-led inquiries less popular than they were.

It is the right decision.  The Commons inquiry will quiz politicians as well as bankers, thereby addressing the concerns that Dr Butler rightly raised.  Ed Balls has effectively been calling for an investigation into himself – he's been arguing for a public inquiry – and now he will get one, if the Liberal Democrats and enough Conservatives back the Prime Minister's plan.  A joint committee of both houses will carry out the inquiry and have the power to question witnesses under oath.

I suggested Peter Lilley or David Davis to chair an inquiry, but there is a logic in simply giving the job to the Treasury Select Committee Chairman (thereby keeping him on side).  Andrew Tyrie is dry, knowledgable, exacting – and no-one's stooge.  The Government wants his committee to report swiftly, so that any recommendations can be part of the bill to enact the Vickers proposals which is expected to come before Parliament early next year.

If I were Mr Tyrie and his inquiry – the Mail suggests that Lord Lawson will be a member of it – I wouldn't feel a need to hurry.  Better to get it right than rush to conclusions just to meet the Government's timetable.  I expect that my original suggestion of Douglas Carswell and Steve Baker serving on the inquiry will be regarded as, er, rather adventurous, Minister; um, rather bold, Mr Chairman.

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