We put freedom of information request over cost of banking commission

A Freedom of Information request has been lodged by the editor of Introducer Today about the cost of the Independent Commission on Banking (ICB).

We have asked the Treasury how much has been budgeted for the ICB, how the cost breaks down and what remuneration its five members will receive.

The year-long inquiry will be funded by the taxpayer and will include a series of public meetings.

The launch of the commission coincides with the Government wielding its axe over quangos because of what it perceives as their unnecessary role and cost.

The ICB is led by former OFT boss Sir John Vickers and has four other members: Martin Taylor, former chief executive of Barclays; Bill Winters, former joint boss of JP Morgan investment bank; Clare Spottiswoode, former director general of Ofgas and policyholder advocate of Aviva; and Martin Wolf, chief economics commentator at the Financial Times.

The ICB will look at various proposals, including the introduction of more, smaller banks into the marketplace.

Other ideas it will look at are:

* separation of retail and investment banking
* limits on proprietary trading and investing
* structural separability, including ‘living wills’ and resolution schemes
* increasing capital held by banks
 
Vickers said: “Experience shows that the risks from not asking hard questions about financial stability and competition are far greater than from doing so. Questions about the structure of banking need to be debated in an open, rational way, and we would like to invite anyone with an interest to provide us with news and evidence.”

Introducer Today comments: As well as the cost of the ICB’s investigation, about which we hope to bring you some answers, there is also the question of its long-term cost.

Concerns are understood to have already been expressed by UK Financial Investments, the body which manages the substantial interest that taxpayers have in British banks. The holdings cost £65bn but the other interests of the state run into hundreds of billions.

If any reforms recommended in due course by the ICB were to damage the value of the state’s major holdings in rescued banks such as RBS and Lloyds, the collateral cost could be catastrophic.

Would bashing the banks still be such a popular political gambit if that were to happen?

Meanwhile, do we need a commission to look at proposals such as introducing more, smaller banks? That is happening already. Metro Bank, the first new high street bank to launch in the UK for a century, opened its doors in July. Virgin Bank, although delayed, should launch in the first half of next year. And Tesco Bank, already an online reality, will be appearing in how many stores across the country?

Your thoughts, please.