Is parliament good for anything? This is, in effect, the question behind the coming Libor investigation. Ed Miliband’s assumption that to get any questions answered you need a judge-led inquiry fits a trend, and one that Rod Liddle examines in this week’s magazine. For my part, I’m uneasy about the deification of the judiciary and quite liked Rod’s idea of having an inquiry into the judges, led by a butcher. If parliament doesn’t work, I think the answer is to fix it rather than give up on it. So a lot is now resting on Andrew Tyrie, who is about to chair the parliamentary investigation into Libor, who must next week start to select the Libor committee’s members and define its remit.
Tyrie was named Select Committee Chairman of the Year in the Spectator/Threadneedle parliamentarian of the year awards, and it’s worth reminding CoffeeHousers why. It was a new award, designed for a new era of committees which are not controlled by the whips and are capable of provocation. In America, Congressional committees are huge powerhouses. In Britain, the Commons committee have been a bit tame. Since Tyrie took over he has dragged Jean-Claude Trichet kicking and screaming to give evidence to MPs. In the words of one of our judges last year, ‘the only time I’ve seen smile wiped off Osborne’s face is when he comes before the Treasury Select Committee’. Tyrie is a fully paid-up member of the awkward squad — and we now need a committee of awkward people to get to the bottom of what The Spectator’s leader column this week refers to as an ‘omniscandal’.
Tyrie need to set distinct terms for his inquiry: this is a look at the operation and corruption of the wholesale debt market. It’s not an inquiry into the City more generally or a show trial for the bankers. And while I am no fan of Ed Balls, it shouldn’t be an inquiry into New Labour either. It says much for Tyrie’s credibility that, even after last week’s partisan comments from the PM and Chancellor, Balls agreed to his chairmanship. For the committee to go after Balls would undermine the credibility of his committee and — more seriously — parliament itself.
For my part, I’m hoping Tyrie will expose the Bank of England to proper scrutiny. In his interview with James, Osborne was very quick to exculpate the Bank — understandable, given that he’s so heavily dependent on Sir Mervyn’s magic money machine. But if Paul Tucker knew that LIBOR was malleable in 2008, as now seems to be the case, why didn’t he do anything about it? The whole way the Bank has been run by Sir Mervyn King — obsessing about the CPI index being wilfully blind to malpractice in London — is very much a factor. Tyrie has already hauled in Sir Mervyn to explain himself over QE. The Governor was visibly appalled at this lèse majesté; we need a good deal more of it.
Tyrie is smart enough, awkward enough and unbiddable enough to chair an inquiry that will actually get to the bottom of this. And maybe even call Bob Diamond back: a few MPs believe the ex-Barclays chief was rather less than candid last week and did indeed know that the FSA had expressed concern about the whole way Barclays was being run. The truth is still out there. It’s now up to Tyrie to show if parliament is capable of getting to it.
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