As it happened: MPs quiz Bob Diamond

Hello, and welcome to our live coverage of the Barclays rate-rigging scandal. In half an hour David Cameron may be be asked about the affair in Prime Ministers Questions. Then at 1415 Mr Diamond faces MPs on the Treasury Select Committee.

The prime minister has ordered a parliamentary investigation into the scandal, but Labour are continuing to press for a full public, judge-led inquiry, and Ed Miliband is expected to raise this again at PMQs.

Why is Libor so important? Take a look here at the issues involved.

Barclays published an email on Tuesday, in which Mr Diamond detailed a phone call he had had with Bank of England deputy governor Paul Tucker in October 2008 about Libor rates. Mr Tucker mentions "senior figures within Whitehall" asking why Barclays was setting its Libor rate at the "top end". Attention has turned to the Labour government at the time.

There are a lot of technical terms being used to describe what Barclays staff did when they rigged the Libor rate. But help is at hand with this handy glossary of financial language.

A spokesperson for former Labour minister Baroness Vadera says she had "no recollection" of speaking to Paul Tucker or anyone else at the Bank of England about the price setting of Libor.

Labour's Ed Balls, former economic secretary to the Treasury, tells the BBC: "I had no conversation with anybody about the Libor market, and at no point while I was an adviser or a minister, at any time were concerns raised about the Libor market from the FSA, the Bank or the Treasury."

Former City Minister Lord Myners says he also had no discussion about the Libor rate-setting process and did not speak to Mr Tucker about it. "I'm not falling into the class of people who have no recollection," he says, in what seems to be a clear reference to Shriti Vadera.

The Commons benches are filling up nicely for prime minister's questions - which is sure to be dominated by the rate-fixing scandal and Bob Diamond's role in it

For the next half hour we will be giving you live updates as David Cameron faces questions from Labour leader Ed Miliband and backbench MPs.

We will also be covering all the other subjects - such as a critical report on the sale of Britain's forests - that are likely to come up, so do bear with us

David Cameron is on his feet now. He begins with tributes to three British servicemen killed in Afghanistan.

Labour's Fiona O'Donnell raises the issue of food prices. What is Mr Cameorn doing about food inflation?

The PM says inflation is falling in the UK.

Ed Miliband pays tribute to the dead servicemen.

Tory grandee Sir Nicholas Soames gets on to the main business of the day - calling on the government to protect the City of London, to cheers of support from his Conservative colleagues. Mr Cameron agrees, but says it is important to get to the truth.

Mr Miliband now turns to his call for a "judge-led" inquiry into the banking scandal. Mr Cameron says the agree on the substance - attacking the "spivvy" behaviour of bankers.

But Mr Cameron says any inquiry has to be swift. Mr Miliband - attempting to strike a calm, statesmanlike tone - says he understands the need for speed but says the wider culture and practices of the City need to be investigated too.

Mr Miliband raises Leveson - he called for an inquiry into press standards which was initially rejected by the government.

A relatively restrained exchange so far on this highly contentions issue. Mr Cameron says Vickers and other inquiries are also underway and any judge-led inquiry might interfere with a future criminal investigation.

What if Barclays hadn't lowered Libor submissions? Hugo Dixon at Reuters Breaking Views asks what honesty would have cost the bank.

Noise levels rising as Ed Miliband says he doesn't think the PM "gets it" over the level of public concern. Mr Cameron says the government is already implementing the Vickers inquiry and is splitting the banks. It has also scrapped Labour's "tripartite" regualtion regime. And Bob Diamond is being grilled by the Treasury committee.

Mr Cameron says he is not taking lectures on "getting it" from Labour on this issue and calls on Labour to abide by the outcome of a Commons vote on a judge-led inquiry, which is likely to go the government's way due to their majority.

Speaker Bercow tells government MPs to pipe down and stop being "naughty boys" as noise levels get out of control.

The Speaker now has to tell Labour MPs to be quiet after Ed Miliband digs out an old quote from Mr Cameron calling for lighter touch banking regulation.

Mr Cameron, who always gets the final say in these exchanges, says the Higg's Boson particle may have been found, but Labour had yet to "find its sense of shame" over bank regulation.

DUP MP Jim Shannon raises RBS banking problems in Northern Ireland. The PM says he has received assurances customers will not be left out of pocket.

Anas Sawar, Labour MP for Glasgow Central, calls for a free vote on whether there should be a judge-led inquiry and asks if he will back criminal probes into the banking scandal.

Mr Cameron says a banking inquiry held by MPs would be quicker.

On to other subjects now. Labour MP Ian Lucas is slapped down by the prime minister after asking if he has a policy on an EU referendum.

Just to recap on where we are with the banking inquiry: on Thursday, MPs will vote on whether to hold a judge-led inquiry, favoured by Labour, or a parliamentary inquiry, favoured by government ministers.

City news: Barclays share price was down 1.3p at 165.8p this morning after Oriel Securities cut its target price, saying it expects Barclays Capital to be wound down.

Labour MP Graham Stringer calls on Mr Cameron to "stop dithering" and hold an EU referendum. Mr Cameron said he should swap sides and join the Conservative benches.

Conservative MP David Morris raises a road safety issue in his constituency.

Tory grandee - and father of the house - Sir Peter Tapsell calls on the PM to ensure "delinquent" bankers do not walk away with huge payouts. Mr Cameron says he very much hopes that doesn't happen.

Twitter users have been planning flash mob protests outside Barclays branches today and one branch that seems to have been targeted is in Victoria. Using the #ByeBarclays hashtag, the flash mob made its way to Barclays' branch in Victoria Street armed with banners denouncing the bank.

Labour veteran Michael Meacher asks about capital gains tax - and receives a reminder from the PM about his role as a minister in the previous government.

Lib Dem Duncan Hames asks about millennium development goals.

More protests - people from the Move Your Money campaign group are putting up posters on a branch of Barclays in Westminster.

The DUP's Nigel Dodds asks if businesses can be protected from the Ulster Bank debacle. Mr Cameron says he will ensure HMRC look into any issues.

Over on the Guardian there's a readers' poll on that memo released yesterday detailing a conversation between Mr Diamond and Bank of England deputy Paul Tucker.

Another Labour call for a free vote on a judge-led inquiry is given short shrift by Mr Cameron. He accuses Ed Miliband of trying to block an inquiry by MPs because Labour does "not want it's dirty laundry aired in public".

Banking shares are trading lower in London amid fears that other banks will be implicated in the rate-rigging scandal when Mr Diamond is grilled by MPs later. You can see the latest banking share prices on the BBC's market data page here.

A veritable stampede of MPs from the green benches as prime minister's questions comes to an end. Not much interest in Health Secretary Andrew Lansley's statement, apparently.

It is significant - as James Landale's earlier copy revealed - that the motion for the Parliamentary inquiry is vague and, therefore open to change. Also, today Downing Street is saying that the parliamentary committee can, in effect, set its own remit.

Just a reminder of what that email from Bob Diamond to then Barclays chief John Varley in 2008 said: "Further to our last call, Mr Tucker reiterated that he had received calls from a number of senior figures within Whitehall to question why Barclays was always toward the top end of the Libor pricing... Mr Tucker stated the levels of calls he was receiving from Whitehall were "senior" and that while he was certain we did not need advice, that it did not always need to be the case that we appeared as high as we have recently."

With Bob Diamond's appearance in front of the Treasury Select Committee a little over an hour away, here's a reminder of the key players in the Barclays scandal.

The BBC understands that as yet the Treasury Select Committee has no date for seeing Paul Tucker, and has not so far considered whether to call him. It will consider that some time after Mr Diamond's hearing today.

Coming up on the World at One on BBC Radio 4, an exclusive interview with Baroness Vadera, a key Labour minister in 2008.

Baroness Vadera denies she spoke to the Bank of England about fixing Libor rates. We'll bring you the highlights from that interview.

Baroness Vadera, who yesterday said she had "no recollection" of talking to Paul Tucker about Libor, is now more categorical: "No I didn't speak to Paul Tucker or anyone at the Bank of England about the rate setting of Libor. I didn't speak to Paul Tucker about Libor."

She explains her previous comment: "I'm afraid I was at an airport going through security when I was asked that question yesterday."

Baroness Vadera, a former investment banker, was one of Gordon Brown's closest economic advisers.

On the previous government's concern about Libor, Baroness Vadera says: "I can only speak for myself. I can't speak for others in government. Of course Libor was a concern. There's nothing wrong with concerning yourself with access to credit. It's the job."

In an interview with the Spectator magazine, Chancellor George Osborne denies the Bank of England urged Barclays to get its Libor rate down. This charge has been "specifically addressed, not just by our own investigators at the Financial Services Authority but also in the US Department of Justice and they are not people who will pull their punches and they're very clear that the Bank did not issue instructions to Barclays to cut its Libor rate", he says.

"As for the role of the Labour government and the people around Gordon Brown, well I think there are questions to be asked of them," Mr Osborne tells the Spectator.

According to PR Week Barclays has enlisted Portland PR to help with crisis response.

Bob Diamond arrives to face MPs, surrounded by a scrum of photographers. Pictures to follow.

The former Barclays boss is all smiles as he arrives to face the Treasury Select Committee but Mr Diamond is sure to face a grilling by MPs.

A note on timings - the Treasury Select Committee hearing with Bob Diamond is expected to start at 1400 and is expected to last for two to three hours.

So who are the MPs that will be quizzing Mr Diamond? Find out here.

The select committee is ready and waiting. one empty seat on the panel. Bob Diamond all in blue.

The committee sharpen their pencils in anticipation.

Andrew Tyrie opens up with an appeal to Mr Diamond to speak freely, reminding him that he is protected by parliamentary privelege and is now unemployed.

Bob Diamond: "I love Barclays. 16 years ago I joined Barclays and it's been 16 years of tremendous enjoyment."

Diamond: "I worry that the world looks at [Barclays as] a small group of traders whose actions were "reprehensible"

Diamond straight out of the stalls with a staunch defence of Barclays conduct, says it "has not come out in court of public opinion".

Diamond: "We [Barclays] need to get through this period and the best way for me to do that was to step down."

Diamond says decision was made to step down on Monday when it became clear that support from regulators "wasn't that strong".

Tyrie quite insistent his witness answers questions, doesn't want him to evade issue of Mervyn King/Adair Turner's role.

"I didn't recall" featured in several responses from Diamond already. It's clear Tyrie is playing hard-ball on the culture the former chief executive oversaw.

Committee chairman Andrew Tyrie asks if in a February meeting with the FSA, the regulator expressed concerns, saying it had lost confidence in Diamond's team at Barclays. Diamond says the FSA said they felt there were "some culture issues" but were "specifically happy" with the focus and tone at the top of the bank.

Tyrie appears to be trying to clear Paul Tucker of any blame in the Barclays rate rigging.

Twenty minutes in and it's fair to say Mr Diamond does not appear to be a confident, well prepared witness

Sky News now say Barclays have issued a correction saying it does NOT have recording of 2008 phone call between Bob Diamond and Paul Tucker.

Smiles from Bob Diamond as Tyrie forces him to say that he believed "Whitehall" in that note of that Bank of England phone call referred to "officials in the government" - ie civil service.

All very friendly between Bob Diamond and Tory MP Jessie Norman, who have brief exchange, with wry smiles, about the time they both worked for Barclays subsidiary BZW.

Diamond says he did not believe there was an instruction to lower Libor despite a perception in Whitehall that Barclays' rates were high, relative to other banks.

Diamond smiling more often now and nonchalantly cleaning glassesas he faces questions from Jessie Norman.

Asked if the Bank of England was slow to respond to the 2007-08 financial crisis, Diamond says: "I wouldn't call [my view] critical - we were encouraging more activity from the Bank of England in the money markets." He also says: "I think the Fed took the lead."

Jesse Norman appeared to be more supportive of the witness and the decisions made by the bank he used to run. "Sympathetic questioning" might be a fair way of describing it.

Diamond: "Paul [Tucker] didn't mention who he was referring to [in Whitehall] or I would have put it in the note. I wouldn't want to speculate." But Diamond says he believes it was "senior people in the government".

So Jesse Norman MP used to work for Barclays, Michael Fallon MP has declared an interest in a brokerage involved in investigating the Libor scandal...

Diamond says he cannot recall if he met Shriti Vadera before the 2008 phone call with Paul Tucker. Meetings were primarily driven by then chief executive John Varley, he says.

Diamond makes an important point that the sharp fall in his bank's Libor submissions in late October 2008, and the fall in the Libor rate generally, was not due to manipulating the Libor submission after getting a nod and a wink from Paul Tucker, but because two days later Barclays raised £6.7bn from Middle Eastern investors. This improved the bank's standing in the financial markets and lowered its cost of borrowing - which meant it could genuinely lower its Libor submissions.

Michael Fallon is playing the role of treasury select committee member AND Tory party deputy chairman, with "Shriti" [Baroness Vadera] questions on the role of the former Labour government City fixer.

Michael Fallon asks how Jerry del Missier, another senior executive at Barclays who resigned on Tuesday, could have misconstrued the conversation Diamond had with Paul Tucker. "I can't put myself in Jerry's shoes," says Diamond.

Committee chairman Andrew Tyrie in complete control of proceedings: assertive and accusative.

Bob Diamond is often using the politician's linguistic technique of referring to the questions put to him as "important questions".

David Ruffley, Conservative: "Why on earth didn't you know that this was going on on your watch?"

Diamond: "When I read the emails from those traders I was physically ill. Should those actions be dealt with? Absolutely. That behaviour was reprehensible." But stops short of saying bankers should face criminal prosecution.

Diamond "wasn't aware" of George Osborne's comments that his resignation was good for the country.

Mr Diamond makes his most impassioned defence of his conduct and the conduct of Barclays. He repeatedly says he "loves Barclays".

Tytrie choosing once again to adopt confrontational tone with the witness, says committee might be "sceptical" about evidence.

Diamond: "This was not about lowering Libor rates, this was about..." George Mudie, Labour, cuts him off: "No, this was about not nationalising Barclays."

Bob Diamond barely able to get a word in under questioning from Labour's George Mudie who is close to contemptuous of the former Barclays boss.

George Mudie presses Diamond on how all of this could have gone on under his watch, suggesting that the former Barclays boss was either incompetent or dishonest. Diamond looks ruffled.

Bob Diamond appears a little weary now, particularly after that onslaught from Labour's George Mudie.

Bob Diamond says he wasn't referring to former Chancellor Alastair Darling in his comments about the government fearing Barclays might need a bailout.

Tory MP Andrea Leadsom is conducting some aggressive questioning on the specifics of trading floor supervision and compliance. She is also former Barclays employee.

Diamond refuses to blame Barclays' compliance department, whose function it was to look for criminal activity. He solely blames the 14 traders for their behaviour.

Interesting words from Diamond in response to Andrea Leadsome when he says he blames "individuals" for this bad behaviour, not a wider culture or systemic issues, at Barclays

Labour's Andy Love pushing his leaders' lines on calls for independent inquiry and Diamond sacrificing a large slice of his severance package.

Diamond reiterates that even though Barclays is the only bank currently in the frame, it is clear that attempts to manipulate Libor rates were industry-wide.

Bob Diamond glad to hear praise from one MP who praises him for success at Barclays Capital: "just looking for some love" he says with a smile.

Michael Garnier trying to get to the bottom of why the Libor rate setting sytem was "so flawed".

Diamond makes clear he will not stand in the way of criminal investigations.

An all-powerful Bank of England is needed to re-impose discipline on the City, financial historian Professor Niall Ferguson tells the BBC's Hardtalk programme

Diamond: "Do I believe ethics and integrity and values are important? You bet."

Diamond says the 2008 Paul Tucker call came to him in his office in New York.

Diamond uses the "I love Barclays" line one too many times. "You've not even met Barclays, let alone love Barclays!" retorts Teresa Pearce.

Diamond repeats that Barclays took appropriate action when it found out about the wrong doing and sought to lead the field. But admits: "We did not think the focus on this would be as intense in terms of hurting our brand and reputation."

tweets: MPs simply pursuing their own agendas with Diamond..no opressure on him no coherence in questioning..no team work on the Select Committee

Much note passing, chatter and amused glancing between MPs Fallon and Ruffley

Diamond says he personally did not publicise the email regarding the Paul Tucker call. "Barclays released the package."

tweets: 'we can't say no one knew there was an issue around Libor in the industry', says ‪#diamond‬. yet he only knew about it at Barc this month..?

Having claimed to love Barclays so much, Diamond is asked what the principles were of the bank's founding Quakers. He is silent.

The answer? Honesty, integrity and plain dealing, we're told.

John Mann seems sceptical that Diamond could "see nothing, hear nothing, know nothing" in the three-year period when Libor was being fixed from 2005-2007. Accuses him of being either grossly negligent or grossly incompetent.

John Mann: "You must have been grossly incompetent if you weren't complicit in this."

Labour's John Mann clearly seeking to paint a picture of Bob Diamond as a chief executive who was detached from the coal face and was unapproachable. He asks why concerns of those who didn't go along with rate fixing weren't passed to him.

Labour MP John Mann suggests Diamond give up his shares in Barclays. "Then you might get a little love."

Questioning moves on to Lib Dem John Thurso, who compares Diamond to former English cricketer Geoffrey Boycott - "occupying the crease for many hours and I'm not sure we're getting any further forward".

John Thurso suggests the "One Barclays" model does not work. "We need a culture that understands the High Street and a culture that understands the City. If we put them together we lose."

Diamond replies that "One Barclays" refers not to a business model, but to a culture.

On that Paul Tucker conversation again, Diamond says, "He was pointing out the problem and I was pointing out the problem wasn't with Barclays, the problem was with other submissions." He adds he didn't see Tucker's comments as a directive but as a "heads up" that Barclays' rates were pretty high.

Drawing to an end now. Diamond is asked for any final remarks.

In his final submission, Bob Diamond says: "I know Barclays would still act the same way [if something like this were to happen again] to come out and be the first to correct it. But I worry that the impact of being first and the recation to the one firm that's out first outside of the industry contact doesn't create great incentive for others to come forward."

He adds that he looks forward to the wider investigation into Libor, and Barclays will help if it can.

And that's it in the Wilson Room, Portcullis House. Just as when he entered the building, there's a media scrum there for Diamond's departure.

Talking on the News Channel after the committee winds up, Tory MP David Ruffley says he is not satisfied by the answers Mr Diamond gave him and his colleagues: "He [Diamond] was inviting us to believe that at the very top of Barclays, between 2005 and 2009 while his executives were lowballing (fixing interest rates) he knew nothing about it. Either he was complicit or incompetent. It's staggering and quite difficult to believe that as successful a banker as this was stupid"

Bob Diamond stuck to the line doggedly throughout that he heard no wrong doing, saw no wrong doing, and knew of no wrong doing. He emerged unbloodied and unbowed. But this is very far from the end of the matter for Bob Diamond.

That winds up the Live Page for now. Before his appearance today, there was much talk that Bob Diamond would come out with all guns blazing, with perhaps some at the Bank of England and in the previous government nervously awaiting his testimony. Yet he refused to finger anyone for attempting to put his bank up to rate fixing. He played a pretty straight bat. In fact, his one smirk during his appearance came when one MP told him he had given little away. Don't forget you can follow the story as it develops on our main news page