Cable calls for RBS to be split up

Vince Cable Vince Cable also wants the government to show more leadership

Vince Cable has called for Royal Bank of Scotland (RBS) to be split up, in a letter leaked to the BBC.

Writing to Prime Minister David Cameron and Deputy Prime Minister Nick Clegg, Mr Cable said RBS should be turned into a new "British business bank".

Mr Cable also said the government needed to show "more leadership" in supporting key technologies.

He added that the government lacked "compelling vision".

Writing about RBS, of which the government owns 82%, Mr Cable said: "My suggestion is that we recognise that RBS will not return to the market in its current shape and use its time as ward of state to carve out of it a British business bank with a clean balance sheet and a mandate to expand lending rapidly to sound business."

BBC business editor Robert Peston said this suggestion was "a big point of difference" with the Treasury, which wants RBS to be sold off as soon as possible.


Our business editor added that Mr Cable's letter, dated 8 February, gives a "brutally frank analysis of what he sees as the shortcomings in the government's industrial and economic policies".

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What may be seen as extraordinary is that he appears to be criticising in part the work of his own department”

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Mr Cable also uses the letter to say that the government responds to crises after they have developed, instead of being more strategic and proactive.

Our business editor said: "Whether his colleagues, especially his Conservative colleagues, will welcome the implication that the government is the slave of events, rather than the master of them, is questionable."

Mr Cable, one of the most senior Liberal Democrats in the coalition government, told BBC Five Live that his letter "certainly wasn't a comprehensive attack on the government's economic policies".

He added: "This is an enormous storm made out of something much less.

"I think a great deal about what the government is doing, and what my department is doing."


Downing Street has said it does not comment on leaks, or on correspondence between ministers.

Vince Cable: "The letter is certainly not anti-government"

Chuka Umunna MP, Labour's shadow business secretary, said Mr Cable's letter "underlines the extent to which the Department of Business lacks clout and has become marginalised".

He added: "It is becoming increasingly clear that David Cameron and George Osborne have become roadblocks to the modernisation and reform needed to create a more productive economy."

John Walker, national chairman at the Federation of Small Businesses (FSB), said he welcomed "the debate that the business secretary's letter will bring".

He added: "As the FSB has long said - tinkering around the edges will not help.

"We need bold action - such as he suggests on RBS - and as such have called on the government to establish a small business administration to fully champion the needs of small businesses."


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  • rate this

    Comment number 102.

    If a government minister at the heart of policy-forming is frustrated, God help us all.

  • rate this

    Comment number 101.

    I wouldn't dis Cable too much, he was one of the few politicians speaking out against the Murdoch empire before the doo-doo hit the fan.

  • rate this

    Comment number 100.

    Good Old Vince, when the custard pies start beiing thrown at the Lib Dem Conference next week, he does not want them to be thrown at him. Look lads I am on your side!

    Watch it Cleggie someone maybe after your job, you have been left to pick up the NHS mess..

  • rate this

    Comment number 99.

    I would expect that such frank discussions take place all the time in government who ever is in government.

    As far as having "a compelling vision of where the country is heading beyond sorting out the fiscal mess" goes, there is nothing more important than sorting out the mess. I'd rather the government continues to concentrate on that.

  • rate this

    Comment number 98.

    To suggest giving RBS a clean balance sheet and using it as a "British" bank is not without considerable risk. Surely this could not be considered until the Scots had held their referendum. After that there might some certainty as to the future of RBS, but not before.

  • rate this

    Comment number 97.

    Once again we are treated to Vince "the wind-bag" Cable.

    This is a man with no ideas and nothing to contribute. He has been in the job for a period and has thought of nothing. His only policy - a wealth tax to punish those who have dared to save. Perhaps his generous corporate pension should be taxed in the same way.

  • Comment number 96.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • rate this

    Comment number 95.

    Well do something about it Cable and stop your continual whining!! So far the LibCons have a far clearer and decisive strategy for the future than the last bunch who led us almost to the abyss.

  • rate this

    Comment number 94.

    Vince Cable has to be a joke - someone please tell me if that is so. His ability to deliver hot air over everything from banking reform to industry and deliver zero is stunning.

  • rate this

    Comment number 93.

    Total non story BBC! Get a grip.

  • rate this

    Comment number 92.

    100% right.

    The Tory's are only interested in helping themselves and give a stuff for anybody else. Lets look at the 50p tax rate for instance. They seem to like making cuts, so those at the bottom receive less and those at the top receive more but those at the top are also recieving cuts that benefit themselves. It's a complete and utter joke.

    David camamoron needs to go, he is a useless joke

  • rate this

    Comment number 91.

    Vince Cable is right to push the Govt to be pro-active. Crisis management is getting tiresome now.
    On RBS he's wrong though. The Govt ought to take small bits of RBS, Lloyds, HBOS, B&B and NR and turn that into the lean lender kickstarting the economy.

  • rate this

    Comment number 90.

    16 " How can we plan for that with the whole world in grave economic danger? This fiscal mess has to be the priority and, once there seems some sign it's over, then we can plan for a brighter future."

    What it means is - in practice - bail the rich bankers out of a titanic mess of their own devising and causing, without them having any inconvenience. Then worry about anybody else left standing

  • rate this

    Comment number 89.

    Is not Cable trying to say : This Government has no vision ; I can see this because I am part of the Government that cannot see.
    It really is time to carry out some serious tests on Mr Cable.

  • rate this

    Comment number 88.

    Lack of planning, unelected and making heinous changes to the NHS that were in neither of the coalitions manifestos.....the defence rests!

  • rate this

    Comment number 87.

    I think Cable is right but, in fairness to Cameron, this govt is a logical step in a process that's been going on a while now inc. Labour govts. When DC referred to his cabinet a 'management team' he WAS stating his vision. All of our politicians seek to manage UK plc. It seems to have gotten lost that we might be more than a 'brand'.

    There's no 'vision' in UK politics.

  • rate this

    Comment number 86.

    #67 Endgames- shame you had to spoil your comment with a mysogynistic remark about 'womens hands'...I think you will find that the majority of women in this country work much harder than old Etonians for a lot less reward than even the averagely educated male. Just 2 days from IWD and we have to put up with this! Plus the stats show that the coalition deems women an easier target for cuts than men

  • rate this

    Comment number 85.

    We have a budget coming shortly. Unless there's radical reform in there, we can mark Mr Cable as being entirely correct.

  • rate this

    Comment number 84.

    @67 Endgames -" Camerons family have been in banking for generations, ripping people off whilst doing nothing of any relevance"

    I think being PM is relevant. Did you not fancy a go at it?

  • rate this

    Comment number 83.

    I like VC, he speaks his mind and right or wrong at least he's not someones puppet.


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