This report brings long awaited justice to the banking sector. Mr Osborne would do well to heed it

The public instinctively feels the law has been found wanting in the aftermath of the banking collapse

The UK charges one of the lowest rates among the world’s biggest economies (Getty Images)

From the Financial Times to The Sun, the newspapers’ praise for the bang-up-the-bankers report this morning was universal, and rightly so.

But just how much of the impeccably reasoned recommendations within it actually get implemented is another matter.

For, make no mistake, we will now see a lobbying exercise by the banking industry like none other. Well, none other since the last one.

For, as former Labour City minister Paul Myners pointed out on Today this morning, the track record of the banks’ success in watering down curbs on their businesses is extraordinary: ringfencing of retail from investment banking, capital buffers, bonus caps, have all been headed off at the pass. Not to mention the lobbyists’ successful push on Myners’ Labour government to deregulate financial services in the first place.

The CBI was the first to press the pillow on the face of the Banking Commission’s reforms today, declaring existing rules were enough. Enforce the current laws on fraud before creating new ones, it ordered. You must not treat executives at banks differently from those in other industries.

This is nonsense. Other industries have not brought our entire economic infrastructure to the brink of collapse. Other industries have not behaved so recklessly as to pitch our economy into a tailspin that has cost hundreds of thousands of jobs. Other industries have not required tens of billions of pounds of taxpayer bailouts. Other industries are not, to use the buzzphrase “systemically important.”

A surprisingly large number of the CBI’s members in other industries who have been on the receiving end of big bank greed agree with me on this score. As Commission chairman Andrew Tyrie MP said this morning: “Bankers are different.”

The Chancellor will, at tonight’s Mansion House speech in the City, use honeyed words to welcome the report on the whole, but such talk is for public consumption only. Privately, I expect he will already be planning his long-grass kicking strategies for the most radical proposals.

Which is a pity. For the report has so much to recommend it. It is not just a spiteful banker bashing exercise. Mr Tyrie goes to extraordinary lengths to explain that the report aims to ensure that “one of our greatest industries can continue to thrive.”

But, in its current state, where the Murder on the Orient Express defence (“we are all guilty”) thrives, not a single senior banker has been jailed for what has all the hallmarks of the biggest fraud committed on the public in the history of capitalism – the credit bubble and its subsequent bursting.

The public instinctively feels that the law has been found wanting, leaving the culprits to disappear into their mansions and holiday homes and enjoy the fruits of their irresponsible behaviour.

This has ripped apart the compact between the banks and the society they are meant to serve, which is bad for us all – banks and citizens.

Mr Tyrie and his commission’s recommendations would go a long way to stitch it back together. The government should turn a deaf ear to those urging it to do otherwise.

You can join our debate on the report here.