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| Version 1 | Version 2 |
|---|---|
| Darling warns banks on loan rates | Darling warns banks on loan rates |
| (10 minutes later) | |
| Alistair Darling has warned the UK's banks that he will take action if they are found to be charging small and medium-sized firms too much for loans. | Alistair Darling has warned the UK's banks that he will take action if they are found to be charging small and medium-sized firms too much for loans. |
| Speaking to the BBC's Andrew Marr Show, the chancellor said he was "extremely concerned" at the allegations. | Speaking to the BBC's Andrew Marr Show, the chancellor said he was "extremely concerned" at the allegations. |
| He said the banks had a duty to restore lending levels, saying the government did not rescue the banking sector "out of some charitable act". | He said the banks had a duty to restore lending levels, saying the government did not rescue the banking sector "out of some charitable act". |
| The chancellor said he would speak to each bank about the matter. | The chancellor said he would speak to each bank about the matter. |
| 'Do their part' | 'Do their part' |
| "The public will now understand it if they [the banks] don't seem to be doing their part," he said. | "The public will now understand it if they [the banks] don't seem to be doing their part," he said. |
| "I want banks to rebuild their balance sheets, but at the same time because of the particular circumstances we are in now, we also need them to relend money." | "I want banks to rebuild their balance sheets, but at the same time because of the particular circumstances we are in now, we also need them to relend money." |
| Mr Darling's comments come after a report by financial website Moneyfacts said banks had increased the interest rates they charge for personal mortgages nearly fourfold in recent months, despite the base rate remaining at a record low of 0.5%. | |
| The British Bankers Association has defended the rise in the cost of borrowing, saying banks are facing "substantially" higher costs. | The British Bankers Association has defended the rise in the cost of borrowing, saying banks are facing "substantially" higher costs. |
| 'Economic recovery' | |
| Mr Darling also reiterated that VAT will definitely return to 17.5% from the current 15% level at the end of the year. The rate of VAT was reduced to 15% on 1 December 2008 to help boost retail sales. | Mr Darling also reiterated that VAT will definitely return to 17.5% from the current 15% level at the end of the year. The rate of VAT was reduced to 15% on 1 December 2008 to help boost retail sales. |
| Turning his attention to the wider economy, the chancellor said he was sticking to the prediction that the recovery will start "at the turn of the year", with modest growth being seen in 2010. | Turning his attention to the wider economy, the chancellor said he was sticking to the prediction that the recovery will start "at the turn of the year", with modest growth being seen in 2010. |
| Official figures showed last week that the UK economy continued to contract between April and June, although at a slower rate than between January and March. | Official figures showed last week that the UK economy continued to contract between April and June, although at a slower rate than between January and March. |
| The economy shrunk 0.8% last quarter, compared with a decline of 2.4% from January to March. | The economy shrunk 0.8% last quarter, compared with a decline of 2.4% from January to March. |