We splashed this morning on how there will indeed be no major restructuring until after the 2015 general election – after Vince Cable accepted that it would be impossible to implement such major reforms before then. (Although the legal framework will be put in place during this Parliament.)
This would reinforce the Treasury’s insistence all along that there was no major Tory-Lib Dem split over the issue.
So who was responsible for creating the impression that the Lib Dems were adamant on immediate reforms to the banking sector to split retail from investment activities?
Step forward Lord Oakeshott, former Treasury spokesman for the party in the upper chamber, who said in the Evening Standard a few weeks ago:
“What would not be acceptable is for Vickers to come out with a radical solution and then the government not to implement it immediately and in full…Every Liberal Democrat from top to bottom is united about that. It will be absolutely critical – a Lib-Dem red line, bottom line, sine qua non – whatever you want to call it. That will be crunch time for the Coalition. If the Vickers Report is kicked into the long grass, it will be curtains for the Coalition.“
In mid-August Oakeshott was interviewed again, this time by the FT, where he made the same point again:
Can anyone in the Treasury or the banks seriously suggest we kick Vickers’ reforms into the long grass until 2019? When Vickers reports, our