Brown admits he made mistakes as chancellor

GORDON Brown came under fire yesterday for his admission that, as chancellor, he was not tough enough in regulating the financial sector.

In a TV interview broadcast yesterday evening, the Prime Minister cited the failure to impose tighter regulation in the years before the financial crash as one of his biggest mistakes.

But Liberal Democrat Treasury spokesman Vince Cable said it was “not enough” for Brown to say sorry, and that any future government must have a plan to ensure that taxpayers are never again held to ransom by the banks.

Shadow chancellor George Osborne said Brown had been slow to admit his mistakes and was now preparing to make another by raising National Insurance, which he branded a “jobs tax that will kill the recovery”.

The row came as Liberal Democrats launched its manifesto for the May 6 general election, which leader Nick Clegg said would provide voters with “an opportunity to shape the future of our country for the better”.

Meanwhile, Labour launched an assault on Tory promises to hand power to the people by scaling back state intervention and giving individuals and communities more involvement in the delivery of public services like hospitals and schools.

Campaign chief Peter Mandelson said the election was shaping up as a choice between “Labour empowerment and Conservative abandonment”, with David Cameron’s proposals leaving families to “fend for themselves”. He unveiled a Labour poster with a picture of the Tory leader’s face alongside the warning: “If you’re there for him, he won’t be there for you.”

The Conservatives’ ‘Big Society’ agenda would mean a return to postcode lotteries in health and education, and shift power away from public service users and towards providers, the Business Secretary claimed.

Brown’s admission oferrors in his handling of the banks in the run-up to the financial crisis came in an interview recorded ahead of the broadcast last night.

Asked what had been his biggest mistakes in office, Brown said: “In the 1990s, the banks all came to us and said ‘Look, we don’t want to be regulated, we want to be free of regulation’.

“All the complaints I was getting from people was ‘Look, you’re regulating them too much’. And, actually, the truth is that globally and nationally we should have been regulating them more. So I’ve learnt from that. So you don’t listen to the industry when they say ‘This is good for us’. You’ve got to talk about the whole public interest.”

Speaking on a campaign visit to Leeds yesterday, Brown said: “I have been saying for years that the regulation of banking has got to be stronger. I have been saying since the crisis started that we didn’t have enough global regulation.

“I was explaining (in the interview) that we had a huge amount of pressure from the City and other organisations that wanted more deregulation — including from the Conservative Party.

“We know now that there should be more regulation and there should be more regulation internationally, and that is why I am trying to get the global financial tax, global supervision and international agreement.”

Brown’s recognition of his mistakes comes ahead of tonight’s first televised leadership debate of the election campaign, when the Prime Minister is likely to come under intense pressure from Cameron and Nick Clegg over his handling of the economy. Shadow chief secretary to the Treasury Philip Hammond said it was an “extraordinary” admission for Brown to make, after two years of insisting that the banking crisis was caused by global problems which did not originate in Britain.

“He has finally admitted that it was his regulatory system that he personally implemented in 1998 that caused excessive risk-taking and excessive lending in the UK and contributed to this problem,” Hammond told the BBC.