Britannia Radio

This is only a preliminary  'laying-down of positions' paper.  He has 
given a lot away but not the absolutely vital point of EU 
enforcement.  But wait; he may well cave in yet.

XXXXXXXXXXXX CS
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FINANCIAL TIMES 4.3.09
Darling backs EU watchdog

By Alex Barker in London and Nikki Tait in Brussels

Alistair Darling has thrown his support behind an overhaul of 
European financial regulation that would create a new regional body 
with powers to set some rules and "name and shame" countries that 
breach best standards.

But the UK chancellor has also signalled opposition to the 
establishment of a pan-European regulator with strong powers to 
intrude in national regulation.

Mr Darling's intervention, in a letter to European Union finance 
ministers obtained by the Financial Times,  [that sounds like another 
leak!  SEND FOR SCOTLAND YARD!  RAID HIS OFFICES! -cs]  comes as 
Brussels prepares to commit today to push for a new structure for 
supervising institutions and monitoring systemic risks by 2010.

EU commissioners this morning are expected to broadly endorse more 
than 30 reforms outlined last week by a taskforce headed by Jacques 
de Larosière, former French central banker.

However, Mr Darling's comments will underline how difficult the 
process of obtaining political consensus is likely to be. He signals 
in his letter support for a single rule-making body "with a specific 
objective to iron out national divergences". It would be given powers 
to set financial rules and monitor how well the standards were being 
implemented.
"In short, it would, over time, become a regulatory authority and a 
forum in which the effectiveness of national supervisors can be peer 
reviewed," he said.

That, however, differs from recommendations by Mr de Larosière, whose 
taskforce last week advocated giving the three existing committees of 
national supervisors - covering banking, insurance and securities 
markets - greater powers.

By contrast, Britain's proposed body would have no power over 
national supervisors and would not prescribe "detailed supervisory 
practices".

Separately, the chancellor gives broad backing to plans for a pan-EU 
body to monitor systemic risks and provide an "early warning system" 
for other European regulators. But Mr Darling opposes the body 
working under the auspices of the European Central Bank, arguing it 
should be independent and accountable to the European Council.  
[essential for non-members of the eurozone -cs]

The Commission is also likely today to set out a timetable for 
dealing with other more detailed proposals by Mr de Larosière, 
ranging from standards for hedge funds and private equity to 
recommendations on directors' remuneration.

The proposals will be taken up by the spring European Council 
meeting, when EU leaders gather in Brussels in two weeks' time.