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‘Darling has got it wrong’

Chancellor Alistair Darling has been accused of misunderstanding the liquidity crunch after his call for lenders to pass on last week’s bank base rate cut.

Last weekend, the Chancellor said it was time that lenders “played their part” and passed on bank base rate reductions in return for the £15bn that the Bank of England pumped into the markets in the last month.

He told the BBC: “If you can pass on those interest rate reductions, if you can help homeowners, help bus- inesses, that will help all of us get through a very difficult time.”

But Cobalt Capital partner Andy Montlake said: “He does not give the impression that he understands the situation at all and that is not what you need in these times.”

Alexander Hall chief operating officer Andy Pratt says he does not feel the Bank of England is doing enough to educate the Government.

He said: “The BoE needs to make it difficult for the Government – for Darling – to make comments like he has done this weekend.”

“I worry that he does not understand it from a lender’s perspective. He needs to go and see the lenders, that is the first thing you would do if there was a major issue.”

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