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| Version 0 | Version 1 |
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| Pass on rate cuts, MPs tell banks | Pass on rate cuts, MPs tell banks |
| (10 minutes later) | |
| The Bank of England's monetary policy committee has been urged by a group of more than 20 MPs to cut interest rates when it meets on Thursday. | The Bank of England's monetary policy committee has been urged by a group of more than 20 MPs to cut interest rates when it meets on Thursday. |
| They have also tabled a motion in parliament urging all UK banks to pass on benefits to customers. | They have also tabled a motion in parliament urging all UK banks to pass on benefits to customers. |
| The MPs, led by Labour's Jim Sheridan, said the benefits of previous cuts had still not been passed on to consumers. | The MPs, led by Labour's Jim Sheridan, said the benefits of previous cuts had still not been passed on to consumers. |
| They acted after Business Secretary Lord Mandelson said the public would be "surprised" if no action were taken. | They acted after Business Secretary Lord Mandelson said the public would be "surprised" if no action were taken. |
| The motion stresses that cutting rates would assist the economy and all banks and financial institutions should try to "help ordinary people cope". | |
| 'Not unreasonable' | 'Not unreasonable' |
| Lord Mandelson, while on a visit to the Gulf with the prime minister, said small small businesses and mortgage-holders, especially, should benefit if The Bank of England does cut rates by at least 0.5%, as it is expected to. | Lord Mandelson, while on a visit to the Gulf with the prime minister, said small small businesses and mortgage-holders, especially, should benefit if The Bank of England does cut rates by at least 0.5%, as it is expected to. |
| He acknowledged that the government could not force the high street banks to cut rates. | He acknowledged that the government could not force the high street banks to cut rates. |
| "When official rates are being cut, it is not unreasonable for customers to see some benefit from that," he told the BBC's Today programme. | "When official rates are being cut, it is not unreasonable for customers to see some benefit from that," he told the BBC's Today programme. |
| When the government bailed out some high street banks, including the Royal Bank of Scotland, Lloyds TSB and HBOS, by taking a £37bn stake in the, one of its conditions had been for these institutions to restore credit lines, he pointed out. | When the government bailed out some high street banks, including the Royal Bank of Scotland, Lloyds TSB and HBOS, by taking a £37bn stake in the, one of its conditions had been for these institutions to restore credit lines, he pointed out. |
| "If it appeared that the banks were standing in the way between what the Government is doing and how the public wants to benefit, then I think many banking customers are going to be asking some difficult questions of the banks," Lord Mandelson went on. | "If it appeared that the banks were standing in the way between what the Government is doing and how the public wants to benefit, then I think many banking customers are going to be asking some difficult questions of the banks," Lord Mandelson went on. |
| He said that even when the government had taken a stake in a particular bank, it would be operating at "arm's length". | He said that even when the government had taken a stake in a particular bank, it would be operating at "arm's length". |
| But this did not stop ministers from being entitled to express their views and encourage them to do what was best for their customers and the economy, he insisted. | But this did not stop ministers from being entitled to express their views and encourage them to do what was best for their customers and the economy, he insisted. |
| He said that when the government took action, it had "strong expectations" of what it expected the banks to do. | He said that when the government took action, it had "strong expectations" of what it expected the banks to do. |
| This included resumed lending to mortgage-holders, to small-business and to other banks as confidence in the industry grew and liquidity "kicked" in. | This included resumed lending to mortgage-holders, to small-business and to other banks as confidence in the industry grew and liquidity "kicked" in. |
| He was responding to claims made by the HSBC's chief operating officer, David Hodgkinson, that mortgage rates do not just depend on the Bank of England base rate but also market conditions and inter-bank lending. | He was responding to claims made by the HSBC's chief operating officer, David Hodgkinson, that mortgage rates do not just depend on the Bank of England base rate but also market conditions and inter-bank lending. |
| The senior banker was also travelling with Lord Mandelson and the prime minister. | The senior banker was also travelling with Lord Mandelson and the prime minister. |
| When Gordon Brown was asked what he thought of the issue, he replied: "We have had two interest rate cuts in the last period of time, and some of that has been passed on. Let us see what the Bank of England does this Thursday." | When Gordon Brown was asked what he thought of the issue, he replied: "We have had two interest rate cuts in the last period of time, and some of that has been passed on. Let us see what the Bank of England does this Thursday." |