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Vince Cable reinvigorated: the banks should start worrying

Vince Cable is back. After a torrid induction as a Cabinet minister leading to one of those insidious Westminster whispering campaigns about how he was vulnerable should there be a reshuffle in the near future, he came storming back this weekend with interviews in the Mail on Sunday and the Financial Times.

Cable's troubles started when it fell to him to justify in Parliament the Liberal Democrats' abrupt U-turn on higher education tuition fees. Then, just as that row was at its height, a rather pointless stunt by The Daily Telegraph induced him to say that the government was declaring war on the Murdoch empire. This came in the wake of his decision as Business Secretary to refer News International's bid for total control of BSkyB to Ofcom. These remarks resulted in the responsibility for dealing with the bid being passed to Jeremy Hunt on the grounds that the final decision had to be made on strictly legal grounds, unclouded by political views. Oh, how absurd that seems now.
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If Cable hadn't referred the bid to Ofcom for further investigation then the BSkyB deal would have already been history and Murdoch could have sat smugly in his hugely enlarged castle while the storm raged outside. I doubt very much whether we would be where we are now with the intense scrutiny of his UK operation.

Casino banks back in his sights
Cable has made it clear that he feels entirely vindicated in his tough stance on Murdoch and News International and my guess is that most of the public agree with him. Sensing this, he has come out fighting on several fronts and has returned to one of his most popular causes - banking reform.

He has gently questioned why the Independent Commission on Banking under Sir John Vickers was so dismissive of his proposal for a complete separation of wholesale and retail banking. He has been clever in his approach, avoiding the blunt language that got in him to hot water over News International, but succinct enough to rattle a few cages and put down a clear marker for the debates to come in September when the ICB's final report comes out.

The debate on banking reform will be all the better for the participation of a reinvigorated Vince Cable.

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