Tories call for rapid savers' protection

The Conservatives have called for emergency legislation to protect savers' deposits.

Speaking at prime minister's questions in the Commons on Wednesday, senior shadow cabinet member William Hague said the Tories would support a bill being passed before the summer recess later this month.

Hague said the government had agreed with shadow chancellor George Osborne that the limit for savings protected by the government should be raised from £35,000 to £50,000, while the system for paying out should be "simpler and faster".

He added that legislation had been promised in the current session of Parliament, but that this now faced being delayed until after the autumn Queen's speech.

And amid fresh fears of "turbulence in the financial sector" following the bailout by banks of mortgage lender Bradford and Bingley this week, Hague called for a bill to be brought forward immediately.

"Given the approach of an 11-week recess, would it not be prudent and reassuring to expedite this particular aspect of the legislation specifically concerned with deposit insurance and pass it into law as soon as possible?" he asked.

Responding on behalf of Gordon Brown, who was in Japan for the G8 summit, leader of the House Harriet Harman said that a financial services bill containing saver protection clauses had been included in the draft legislative programme for the 2008/09 parliamentary session.

But, while welcoming the Conservatives' support, the minister refused to commit to an emergency bill or take the Tories' "advice" on the economy.

Shadow foreign secretary Hague was standing in for Conservative leader David Cameron, who traditionally steps aside when the prime minister is unable to attend the session.