Chancellor promises protection for savers
Sunday, 23 September 2007 12:00 AM
The chancellor today promised to restore savers' confidence in the banking system after the run on the Northern Rock bank.
In his maiden speech as chancellor to the Labour party conference, Alistair Darling stressed government support for savers, vowing to strengthen protection of ordinary savers and to guarantee their assets in a bank of building society.
He told delegates in Bournemouth he wanted to see measures that could separate out savers' money and pay it out quickly.
Mr Darling said: "No government should ever be in the business of protecting executives who make the wrong call or bad decisions. My job is to protect ordinary savers."
Quipping the banking scare had threatened to turn his trademark eyebrows grey, Mr Darling said the Northern Rock crisis underscored the globalised nature of the world, pointing to the need for effective regulation across the international markets.
He said: "Last week shows us what happens when an event in one part of the world can touch us all in just a few weeks. The time was when a small bank in America got in trouble it was bad news for that town, or state, but nowhere else.
"But today, when a Florida householder defaults on his mortgage, the effects are felt, not just in America, but across the world."
Banks across all nations needed closer supervision, he said, with an emphasis on greater openness.
But he said Britain needed to equip itself in other ways to meet the challenges of globalisation.
The UK will not compete on low wages and low expectations, but on quality and excellence, Mr Darling said.
The government has been warned demand for unskilled labour is set to dramatically fall, prompting forthcoming legislation to raise the education leaving age to 18.
Today the chancellor reaffirmed his commitment to investing in education, marking it out as the "key to the future". He also confirmed the science budget is set to rise to nearly £4 billion a year, as Britain attempts to compete globally on new innovation.
Following a heavily green-hued Liberal Democrat conference, climate change was less prominent in the chancellor's speech, but still featured.
He presented globalisation and international cooperation as key to tackling issues such as climate change. He also reiterated the government's domestic efforts including zero carbon housing and legally binding carbon budgets.
With the unions still rumbling with discontent, Mr Darling gave a clear rebuff to public sector demands for higher pay.
Mr Darling said he would do nothing to undermine the strong economic foundations - or prudent philosophy - inherited from his predecessor.
He said: "As chancellor, everything I do will be to maintain that strength and stability. I will continue the discipline essential to underpin it even when those decisions might be unpopular."
"Chancellors are not in politics to find a fan club," he said; livening up an otherwise flat speech to say he would leave that to his cat.
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