Tim Ball

Liberal Democrat Leader Nick Clegg has urged the Prime Minister to take steps to remove the senior banking executives who were involved in the excessive risk-taking which contributing to the current crisis.

In a letter to Gordon Brown today, Nick Clegg proposes that board members of banks should be barred from taking bonuses, to stop them following distorted short-term business models.

The letter, which asks for clarification on the oversight and conditionality of the financial rescue package, also calls for:

- Measures on the structure of executive pay to be introduced now for all banks
- Qualified new directors to be appointed to the boards of banks that the Government takes a stake in to represent the interest of taxpayers
- Conditions of the bank rescue package to include that banks only repossess family homes as a last resort
- Banks to be banned from withdrawing credit lines from small businesses

Nick Clegg said:

“Now the taxpayer has bailed out the banks, those senior executives who took excessive risks leading to this crisis shouldn't be let off the hook.

“The Government’s rescue package must be used as a starting point to reform the way banks operate to ensure this crisis is never repeated.”