Excuses, excuses

The Globe and Mail reports that much like the Libs, the Cons now seem determined to ignore the stated terms of the opposition parties in order to claim that bank mergers can't be dealt with in a minority Parliament:

Mr. Flaherty told CTV Newsnet that he doesn't expect banks to approach him with merger proposals. "I am not anticipating that," he said.

However, he conceded that the question of whether to allow bank mergers could nevertheless arise this year because the legally mandated review of the financing legislation includes the Bank Act.

"I am sure the parliamentary committee will have a thorough look at all the issues," he said.

Mr. Flaherty's comments gave Canadian banks some clarity on one of the most time-worn issues on Bay Street. Unfortunately for them, it was the wrong kind of clarity, confirming what many senior executives had been expecting -- that a minority government would be leery of addressing controversial issues such as bank mergers.

The interesting question which may come up is the outcome of the committee review. It isn't hard to foresee at least some agreement in principle to the effect that mergers can be approved as long as consumers are protected in the process. And there's no apparent reason why the Cons would want to bear the burden of explaining why that consumer protection is too much of an imposition for them to be willing to make a deal on those terms.