FREE marketeers do not come much more committed than Lord Griffiths of Fforestfach. A man who worked alongside Lady Thatcher and who is now a consultant to Goldman Sachs is not someone who might be expected to shrink at the prospect of competition and market forces.

Yet after looking at the scale of personal debt in Britain, Lord Griffiths has come to the view that its purveyors need to be controlled. What has led him to this conclusion is not merely the immense risk of social misery that he sees piling up but also the potential damage to the economy that could be inflicted by it.

He is not the first to refer to the £1 trillion of unsecured personal debt that now hangs around the necks of Britons as “a time bomb”. Only the Government that has watched while borrowing has escalated has eschewed that emotive phrase, while Conservatives and Liberal Democrats have voiced real concern. And so far the Government’s relative sanguinity has appeared to be justified. Levels of personal bankruptcy are on the increase, but that is thought to be more a consequence of people taking advantage of the more relaxed laws on bankruptcy to rid themselves of debt than enforced financial collapse.

There are occasional horror stories of people committing suicide under the weight of credit card debt that they have amassed but these are rare. The combination of relatively low interest rates and high employment have conspired to ensure that a real crunch has not yet come for those who have been building up their debt levels to contribute to that perilous £1 trillion.

But Lord Griffiths’ fear is that those circumstances could change. “The sheer scale of consumer debt has made millions of households extremely vulnerable to shocks in the economy, both from fiscal mismanagement and external factors such as oil price rises, acts of terrorism and wars,” he writes.

He argues that the banks have been at fault in allowing so many people to expose themselves to such a risk. Some will take issue with his claim that: “Banks market credit too aggressively and protect their own risks but not those of their customers.

“What about the principle of ‘caveat emptor’,” they will ask. “The banks’ duty is to their shareholders and the recent run of record profits shows that they are fulfilling that duty very well.”

The banks, though, are sometimes dangerously cavalier in the marketing, bombarding those on minimal, or even no, earnings with offers of credit cards that can give them instantly whatever they want, from CDs to holidays in the sun. They continue to put the good news in large type and the unpalatable details about such things as penalty charges in very small type indeed.

They do not pool information on credit card customers, which would enable them to prevent those who cannot afford it from collecting wallet fulls of plastic which could endanger their financial health. So Lord Griffiths believes that they must be made to be more responsible. He wants to see the pooling of information made compulsory and he is calling for the banking code to be put on a statutory footing.

He was put to work by Oliver Letwin, the Shadow Chancellor, but the Lib Dems, too, have endorsed his conclusions. The Government may choose to ignore his comments for now but it would do well to pay attention.

Freedom to borrow is much to be desired and debt is not necessarily a bad thing. But the dangers of too much debt are such that those who are vulnerable to it need to be protected. If the banks will not take on that responsibility others must.

Few smiles for Jessops

IN RETROSPECT, ABN Amro Capital’s determination for a speedy sale of the Jessops camera shop business looks a touch unseemly, if prescient. It was only in 2002 that the Dutch bank financed a management buyout of the business, but by last autumn it was so desperate to float the company that it agreed to cut the price from the anticipated 185p to 220p and sell the shares at 155p apiece.

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