Labour leader Ed Miliband
Labour leader Ed Miliband

The leader of the Labour Party, Ed Miliband, has warned that the UK faces a class divide between well-paid top executives and ordinary workers unless the banking system can be reformed.

Speaking at the Reuters news agency in Canary Wharf, Miliband spoke of a "one nation banking" culture that would cure the UK's divided society.

He said: "We are once again at risk of becoming a country separated economically, geographically, and socially. We are once again at risk of becoming two nations in this country. That is not the kind of society in which I want to raise my children."

While Miliband attacked bankers' bonuses, he warned that it was not about rooting out individuals, but changing the whole "culture of responsibility".

He said: "The consequences of the financial crisis are felt every time a library closes, every time a school can't afford a new book and every time a policeman or policewoman is taken off the beat.

"The banking sector needs to understand this. People who did not cause the financial crisis are paying the price. Too many of those who did cause the financial crisis are not."

Miliband, who is enjoying his best run as Labour leader, repeated that bonuses need to reflect the performance of a company. "I am talking about the couple of millions of pounds which too many people seem to receive as a rule, not as an exception," he said.

QE Failure

He also hinted that he thought that the government policy of credit or quantitative easing, is not working, with many small to medium business still finding it difficult to raise money.

"When I met a wind turbine manufacturer in Scotland, he complained that while he had employed 20 people in his factory, it could have been 30 if only he had got the loan he needed from a leading British bank," he added.