BRITISH PRIME minister Gordon Brown vowed his government would be "a rock of stability" for the British people yesterday.
He made the pledge as he and chancellor Alistair Darling disclosed the detail of a near-£50 billion (€64 billion) recapitalisation programme for eight big banks.
But Liberal Democrat spokesman Vince Cable cautioned the Labour government against getting "carried away by hubris", as Conservative shadow chancellor George Osborne warned Mr Brown this was "no moment of triumph" for him.
Another unprecedented day in British banking history left taxpayers set to assume a 60 per cent share in the Royal Bank of Scotland and a 40 per cent holding in the merged Lloyds TSB and HBOS courtesy of a cash injection of up to £37 billion. The chief executives and chairmen of RBS and HBOS were obliged to resign as their banks availed of the government bailout, while Barclays said it would raise £6.5 billion without government help. The FTSE rose 7 per cent on foot of the news of the part-nationalisation programme.
In a statement to MPs in the House of Commons Mr Darling stressed the government did not want "to run" the banks but rather to "rebuild" them. That reflected Mr Brown's earlier assurance that this part-nationalisation was not "standard public ownership" and that the banks would return to private investors "at the right time".
Addressing a business audience at Reuter's in Canary Wharf Mr Brown also confirmed he wanted to see world leaders gather for a new "Bretton Woods" - the 1944 conference convened to establish the post-war financial order.
Invoking the spirit of the "Blitz", the prime minister described the government's actions as unprecedented but essential. "In extraordinary times, with financial markets ceasing to work, the government cannot just leave people on their own . . . we must in an uncertain and unstable world be the rock of stability on which the British people can depend."
Mr Brown continued: "To let the chits fall where they may would be the height of irresponsibility . . . action is needed to protect people who need that help the most."
Anticipating "a new financial architecture for the years ahead", Mr Brown also repeated his claim that he had been pressing other countries to make necessary changes in global supervision since 1998. "Sometimes it does take a crisis for people to agree that which is obvious and should have been done years ago can no longer be postponed," he said.
That claim to resumed global leadership, however, may in part explain Mr Osborne's decision to all but abandon the pretence of bipartisanship in favour of a direct attack on Mr Brown's stewardship of the economy.
"We . . . continue to offer to work constructively with the government on solving this crisis," Mr Osborne told Mr Darling. "But of course the scale of this rescue is only just starting to dawn on the British people."
He added: "This is the biggest bailout in the world so far. Paid for by the biggest increase in debt by any peacetime government . . . and so the British people are in no mood to celebrate. They want to know how their taxpayers' money is going to be protected . . . and how on earth they ended up footing the bill for this painful end to the age of irresponsibility."
