This morning David Cameron called on the government to accelerate legislation to protect savings.
This afternoon Gordon Brown said in my interview* with him that the Banking Bill would increase protection for depositors from £35,000 to £50,000.
This evening the Financial Services Authority are making it clear that neither man has affected what is their decision to raise depositor protection. It will not be in the Banking Bill.
The rise from £35k to £50k does not require legislation. The FSA has the power to do it and has been consulting on the proposal for some time. They were keen to announce their decision at a time of relative calm.
The FSA's fear was that announcing increased depositor protection at a time like this would increase anxiety amongst savers about the safety of their deposits and would lead to calls for a higher level of protection (like that in Ireland where today the government promised to protect 100% of deposits for the next two years).
Did the politicians not understand or did they ignore the FSA's fear in a race to claim the credit?
* This is the transcript of my interview :
Nick R: But government did say it would look again at that issue of protecting depositors after Northern Rock, and it's still not happened. Why isn't it right to say to people, rest assured, all your savings are safe?
GB: We did raise the amount from £35,000 and we're raising it to £50,000...
Nick R: But it hasn't happened yet?
GB: Yes yes, it's in the Banking Bill and it will go through very quickly and I hope it will go through with all-party support