George Osborne's speech on the banks, delivered at J.P. Morgan's offices in Bournemouth, is longer on rherotic than detail, but did contain two new things, strengthening the ring-fencing of high street and investment banking and allowing new entrants access to the payments system.
The question about policy on the banks, as before, is whether it helps or hinders the supply of credit into the economy. The jury is out but it is hard to see it helping. These are the two key points from Osborne:
"Today, we will go further than previously announced, enshrining in law these simple principles. I can announce that your high street bank will have different bosses from its investment bank. Your high street bank will manage its own risks, but not the risks of the investment bank.
"And the investment bank wonít be able to use your savings to fund their inherently risky investments. My message to the banks is clear: if a bank flouts the rules, the regulator and the Treasury will have the power to break it up altogether Ė full separation, not just a ring fence."
He goes on to use the phrase "electrify" the ring fence. The speech is here. This was his second point:
"Payments systems sit at the heart of the banking system. They are the hidden from view wirings that operate every time you get wages paid into your bank account, deposit a cheque or withdraw money from an ATM. Itís how the money flows around the system.
"And itís a bit like the electricity grid, every person and every business needs to be plugged into them to enter the banking market. At the moment, a new player in the industry has to go to one of the existing big banks to use the payment system.
"Asking your rival to provide you with the essential services you need at a reasonable price is not a recipe for success. And it other walks of life, like telecoms, we donít operate like that. There are no incentives on the big banks to deliver new and better services for users Ė like saving the cheque or creating new services like mobile payments.
"Why, in the age of instant communication, do small businesses have to wait for several days before they get their money from a credit or debit card payment? It should be much quicker. Why do cheques take six days to clear?
"Customers and businesses should be able to move their money round the system much more quickly. Why is it that big banks can move their money around instantly, but when a small business wants to make a payment it takes days? The system isnít working for customers, so we will change it.
"I can announce today that the Government will bring forward detailed proposals to open up the payment systems. We will make sure that new players in the market can access these systems in a fair and transparent way.
"The last Government let the established players off the hook by failing to implement the conclusions of the review they themselves commissioned, and allowing the big existing banks to regulate themselves. This Government will make sure payment systems serve the needs of consumers, not the needs of the established banks."