Gordon Brown has declared that the "age of irresponsibility must be ended" as he addressed the crisis of confidence flowing through global markets.
Apparently acknowledging his failure to rein in the excesses of the City in recent years, the former chancellor said in a speech to the UN General Assembly: “This has been an era of global prosperity. It has been an era also of global turbulence. And where there has been irresponsibility we must now say clearly that the age of irresponsibility must be ended,” Mr Brown said in a speech to the UN General Assembly before flying from New York to Washington for emergency talks on the global crisis with President George Bush.
However the prime minister's spokesman sought to deflect suggestions that Mr Brown was indulging in any self-criticism. He said that when speaking of the era of “irresponsibility” the prime minister had in mind the financial institutions which had racked up liabilities and contributed to excessive risk taking in recent years.
Mr Brown told the 192-member assembly that 30 networks of international regulators had agreed to sign up to a new system of “international colleges” overseeing the megabanks whose branches stretch across the world.
Mr Brown reaffirmed his backing for the Bush administrations $700bn bailout plan. “America deserves support from the rest of the world as it seeks to agree in detail what all parties agree in principle,” he said.
He went on: “Confidence in the future is needed to build confidence today. And that confidence will be built by showing that what are global problems can also be addressed by globally coordinated solutions.”
Calling for the swift introduction of improved international accounting standards and disclosure, and greater transparency, he stressed that the oversight of capital flows needed to be global. “That is why we support the establishment of international colleges for each of the largest global financial institutions – with 30 due by the end of this year.”
Officials said Mr Brown and the US president will discuss the global impact of the US financial meltdown as well as strategic issues. The British prime minister will not get involved in the US domestic negotiations on the bailout plan.
Mr Brown's speech crowned a two-day visit to New York for a special UN summit on development aid - which he was instrumental in convening - but which was overshadowed by the financial crisis.
The prime minister told the development summit yesterday that despite the budget crunch, donor countries should stand by their UN commitments to anti-poverty goals which he argued is in their own interests. The emergency summit raised $16bn in new pledges from governments, although the final amount needs to be verified. But despite the additional fund-raising, which exceeded expectations, it will still not be enough to meet the ambitious targets set by the UN to halve poverty around the world by 2015.
Countries like France have made it clear that the credit squeeze will have an inevitable effect on aid disbursements.