Alistair Thompson: David Cameron is right to resist an expensive judicial inquiry into banking

Alistair Thompson was Conservative candidate for West Bromwich East at the general election. He also runs Media Intelligence Partners with business partner Nick Wood, the former press secretary to Conservative leaders William Hague and Iain Duncan Smith.

Reading the papers over the last few days I thought the clamour for yet another expensive show trial - I mean inquiry - would force the PM into announcing yet another costly judge-led probe.
 
I was horrified by this prospect and am delighted that Mr Cameron has rejected these calls, opting for sensible option of a short sharp Parliamentary investigation.
 
This is a victory for common sense, since it halts the prospect of some new body, or group being set at vast amounts of taxpayer’s money to take evidence for a long period before reaching the conclusion that some bankers broke the law and others acted against the interests of their customers.
 

There are those especially on the Labour benches who are saying that Mr Cameron's action are a crude attempt to sweep this issue  under the carpet, or protect the banks - but this is simply not the case.
 
Just like those voters who put him into No 10, I am sure the Prime Minister thinks actions of the banks on Libor, dubious practices around sub-prime and mis-selling scandals are quite frankly criminal and should be investigated by the Serious Fraud Office, police and regulators.
 
His statement yesterday along with a host of his colleagues said that those found guilty should face the consequences: i.e, be prosecuted. They should not be invited to some tedious non-judgemental lawyer-led inquiry to share their experiences only to be allowed to repeat their mistakes again.
 
So I am delighted that the PM has gone against the political weather in dismissing calls for such an inquiry.
 
Instead, Mr Cameron has opted for a Parliamentary committee, made up of representatives from both Houses and led by the highly intelligent and more importantly competent Andrew Tyrie.
 
This makes sense on many levels, not least because judicial inquiries are really a way of kicking difficult issues into the long grass.
 
Secondly in the absence of any sort of policy they are a way of giving you time to come up with a plan. Parliamentary inquiries tend to be much quicker and brutal as the Government has nowhere to hide. They also come up with actual recommendations, not vapid language which has been massaged and watered down by a hundred lawyers.  And let’s not forget that judicial inquiries are horrendously expensive.
 
Finally, these have a horrible habit of coming back to haunt the very people who set them up. Look at recent history and there are loads of examples which prove this point, the most recent being Leveson. Mr Cameron thought that setting up this inquiry would defuse the issue it was formed to address, but it has not. It has instead succeeded in drawing the scandal closer to Downing Street, revealing the close relationship with the Murdoch press and the Prime Minister and Prime Minister’s confidants.
 
And turning to the substance of Leveson, let's consider the aims it was set up to achieve. Has it actually achieved them? Not even close. Has it created a new and healthier relationship between the media and politicians? No. A better regulator? No

In fact as far as I can see it, Leveson has only achieved two things; first, allowing celebrities who have had their fingers burnt when playing with the media to air their grievances, often without any evidence; and, second, it has consumed vast amounts of public cash as an army of lawyers pick over millions of documents, emails, newspaper stories etc. So far Leveson has cost the taxpayer a staggering £3.4 million, which is expected to rise to £6 million by October.  Before Leveson, we had the Iraq inquiry, which cost more than £5 million.
 
And the reasons why that inquiry was set up? Simply to divert the heat away from the then Prime Minister Gordon Brown, who was under sustained pressure from the Conservatives and Lib Dems. Of course the Machiavellian Mr Brown hoped that attention would focus on his old adversary Tony Blair. And what was the result? Has Mr Blair been held to account? No, he is enjoying life earning a whopping £20 million a year and working on a tan that makes Peter Hain turn green with envy.
 
In short, grand judge-led inquires simply don't work. They are a sop to politicians who can point at them and say, look, we are doing something.
 
What we really need is debate and measures in Parliament to address why the regulators and bosses of Barclays in this instance were caught napping again. Were these two groups complicit or unaware? In short are they knaves or fools? Either way it appears they are not fit to oversee the industry and run one of Britain's biggest banks.
 
So well done Mr Cameron for resisting all that sanctimonious political posturing from the Labour Party who - let’s face it - are up to their necks in this scandal. The Libor fixing happened during their time in office, the regulatory regime was set up by Mr Brown and who was City Minister at the time? a certain Mr E Miliband.
 
And although it might be good political sport to have hauled the opposition over the coals on this it will do little to fix the problems in the banking system.