Simon Carr: The Sketch

A right royal mess from the king of the quangoroos
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The Independent Online

The treasury select committee is one of the smaller organs of democracy but size is not important in these matters. It is, like the best smaller organs, the source of much pleasure, some comfort and occasional laughter.

The committee sports a dormouse, three government stooges, and a known Brownite in the chair. But we also find an ex-minister, a former Treasury adviser, a multi-millionaire, a backbencher of the year and two independent-minded Labour members: the stooges are actually outnumbered.

Yesterday, to add to the gaiety of the nation, Sir Howard Davies gave evidence. Sir Howard is always running some damn thing or other, in this case the Financial Services Authority, and he had presented himself to answer questions about what he was doing with his time.

In many cases, it is something so rarified as to be nothing at all. James Plaskitt asked him how easy it was to launder money in London. Sir Howard replied that it was more difficult than most places. But because we had more international banks than anywhere it was probably easier than many places. Years of experience lie behind an answer of that quality.

Sir Howard told us about his new regulation prohibiting abusive short-selling. Not that he was against short-selling. It provided liquidity. He was against it only insofar as he was drafting a regulation against it in some circumstances. Andrew Tyrie asked him whether the abuses of selling short were symmetrical to the abuses of selling long. The chief regulator agreed. Mr Tyrie nodded his long, melancholy face. "So there's no new regulation necessary?" he said. Sir Howard was holed beneath the water line but sailed sluggishly on.

The Labour member Nick Palmer asked three long questions, answering two of them in the process. Maybe he won't be there for long.

Michael Fallon asked whether Sir Howard had set up an investigation into Railtrack. He hadn't. He had started an inquiry. A very different thing. A rather leisurely inquiry, in the event. He had written a letter to Railtrack.

Will it come to anything? The FSA, he admitted, will never be able to regulate the commercial relationships of even the most commercial departments. No, that would be like a government passing a Freedom of Information Act that actually produced freedom of information.

The Railtrack investigation, if there is an investigation, will be conducted by the Department of Trade and Industry. Stephen Byers' old department. You see how neatly they stitch these things up? Jim Cousins pressed Sir Howard to admit that Railtrack should account for its behaviour back to July. Sir Howard seemed to agree. But perhaps he knows not seems.

Sir Howard is a king among quangoroos. There are those who say he will be the next governor of the Bank of England. If so, he would want to do better in his next appearance in front of this committee. With the stooges outnumbered, anything might happen to him.