Is the finance industry responsible for the nation’s debts?

Mervyn King, the Governor of the Bank of England, recently criticised the financial community, sending shockwaves through the industry.

The Governor claimed that the finance industry sought to make money at the expense of consumers who did not fully understand the services they were being sold.

He laid the blame for the financial crisis, the bailout, and subsequent austerity cuts at the door of the banks, speaking at the House of Commons Treasury Select Committee at the beginning of the month.

In a frank and open interview with the Telegraph, Mr King insisted that it was the bankers who prevented another ‘Great Depression’, but conceded that people have the right to be angry.

Mr King admitted that he was surprised the banks had not received more hostility from the public.

Mr King’s comments come after harsh government cuts were announced in an effort to slash the massive debt left over as a result of the financial crisis.

Speaking at the committee, Mr King said: "Now is the period when the cost is being paid. I'm surprised the real anger hasn't been greater than it has."

Senior members of the Bank of England's court have admitted that they are "uncomfortable" with the way that the Governor's role has become politicised.

While giving evidence to the Treasury Select Committee, member of the court Sir Roger Carr said that it was important that Mr King’s position was not scrutinised, and that he should not be drawn into political issues.

But Mr King’s comments have not fallen on deaf ears; not least those who are calling for reform within the finance industry in a bid to see a fairer deal given to the consumer.

Employment training and public services company Action for Employment (A4e) is one firm calling for reform.

Mark Lovell, Executive Chairman of A4e, is focused on developing solutions to the problems he has pinpointed within the financial services industry.

Mark has strong views on the financial products available and is calling for more innovation, transparency and competition among financial service providers.

Mark said: "In the coming months, A4e will invite leading figures from the finance world to develop new approaches to financial service provision and advice.”

“The focus will be on more consumer friendly and affordable products for low income households. We want to change the behaviour of the financial community to these consumers and support changes in consumer approaches to current accounts, borrowing and saving,” said Mark, who sees the problem as being twofold.

He sees this as being fundamental in helping to deliver better, appropriate services at lower costs to low income consumers. At the same time this is a perfect opportunity to re-educate the financial services industry, with the aim being to promote responsible trading at a time of consumer vulnerability.

“Not only does the financial community need to do more for consumers and develop appropriate products but society must also work harder to help people develop the capacity to understand the products available and manage their finances well,” Mark said.

Mark believes it’s all about changing the behaviour of the industry as well as the consumer.

“A4e's services support over 60,000 people a year, already helping people to manage their money more effectively by focusing on helping consumers make better financial decisions and deal with financial problems,” he said.

“This includes helping plan for retirement; managing borrowing and creating saving accounts; budgeting; understanding and managing benefits and tax; insuring and protecting the individual and family; jargon busting and dealing with the financial marketing.”

The news comes just as Chancellor of the Exchequer George Osborne, is set to reveal the 2011 Budget. Mr Osborne has promised growth but no spending cuts in a bid to tackle the country’s debt problems.