Building societies were dealt a blow last week after the Government refused to implement all their proposals to deter carpetbaggers.
Treasury economic secretary Helen Liddell, speaking at the Building Societies Association annual dinner in London, said she was wary of the BSA proposals because they would restrict accountability.
Several building societies were particularly disappointed that their recommendation to strike out section nine of the Building Societies Act, which will be implemented on December 1, was ignored.
Section nine bars building societies from having non-membership accounts.
Liddell's only concession to building society lobbying, which was described as ferocious by one BSA member, was to increase the number of members required to vote on a society's demutualisation to 50 per cent from 20 per cent.
Yorkshire Building Society communications manager David Holmes says: "There are other things that we would have liked her to do but we are realists. The battle was never going to be won but we had to have a go. It raised the level of debate."
Nationwide chief executive Brian Davis said: "We are pleased that the Government has found time to bring in the new Building Society Act which will be fully in force on December1. But there are always improvements we wish to make and we will continue to press for them."
The BSA claims the Act is a victory. External affairs manager Pam O'Keefe says: "We won. We have a new Act of Parliament where the vote on conversions has been moved from 20 per cent to 50 per cent. We have not lost at all."
Liddell said: "If some of you were expecting a dramatic announcement today, I am afraid that you will be disappointed because there is nothing dramatic that the Government can or should do."