The contradiction emerged at the same time as the Office of Fair Trading said it would not refer the proposed takeover of Cheltenham & Gloucester Building Society by Lloyds Bank to the Monopolies and Mergers Commission.
A Treasury minister, Anthony Nelson, admitted that greater accountability must be balanced against the need to keep societies competitive.
Presenting the second part of the Treasury's review of the Building Societies Act 1986, he said: 'The Government believes that it is vital for societies to be fully and effectively accountable to their members.
''Millions of people are members of building societies. They should be aware of their position, not only as customers, but as shareholders in - and owners of - the societies to which they belong.'
The consultation document pointed out that its suggestions on greater member representation on boards, or member consultative committees, would run up against the Financial Services Deregulation Task Force.
The Task Force wants to remove the obligation on societies to send notices of annual meetings and summary financial statements to all members. It also wants to allow societies to adopt new powers by board resolution rather than by a resolution of the members.
These ideas, designed to lift burdens on societies by reducing administrative costs and increasing efficiency, run counter to the review's accent on member participation.
The review was criticised by one society spokesman for being 'limp'. 'This document is designed to set off a debate - but we have already had the debate,' he said.
The review contains a large number of suggested reforms such as putting members on society boards, allowing societies to behave more like banks and even to buy and run banks.
But the publication is merely a consultative document consisting mainly of suggestions, unlike the first part of the review, published in July, which sparked immediate reforms to building society rules.
The Treasury review has been under the spotlight following demands from the British Bankers Association and institutions such as Abbey National that societies should accept more accountability with new powers granted this year.
The Government is determined to proceed with building society reform by consensus, and while reactions to the review are required by 9 November it says that any fundamental reforms of society rules will require primary legislation - which would take years rather than months.
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