CHANCELLOR Alistair Darling faces a fight with European counterparts tomorrow over his opposition to any new pan-European regulator having executive power over the UK’s financial institutions.
Darling is in favour of an EU-wide supervisory body that would identify and warn of systemic risks in the European banking sector.
But at tomorrow’s Ecofin meeting of European finance ministers, the chancellor will lay out the government’s opposition to any new supervisory body having power over British firms.
A spokesman for the Treasury said: “We support a single rule-making body. But we don’t support that body having supervisory powers over banks because we believe that needs to be a matter for national supervisors, who are best placed to respond to a crisis.”
Darling was one of the first finance ministers in Europe to call for an independent international supervisor, in a letter sent to his opposite numbers in March.
But the British government has always been against any such body having direct supervisory powers as it would lack local knowledge.
City minister Lord Myners said last week that national governments were “the only bodies capable of providing any fiscal support to firms”.