Page last updated at 11:41 GMT, Wednesday, 4 July 2012 12:41 UK

PMQs: Cameron inquiry reticence 'due to City donors'

Prime Minister David Cameron is refusing to order a judge-led inquiry into the culture and practices of the banking system because of funding provided to the Conservative Party by City donors, opposition leader Ed Miliband has alleged.

As Mr Cameron took MPs' questions on 4 July 2012, Mr Miliband accused the PM of leading "a party bankrolled by the banks".

The Labour leader called for a two-stage public inquiry: the first part focusing on the Libor rate-rigging scandal, to report by Christmas; the second to be given a longer period to examine wider questions about the culture in the City.

He cited a line from a speech given by the PM to the City in 2008, when Mr Cameron described himself as "a free-marketeer by conviction" and declared that "the problem of the past decade is too much regulation".

"Doesn't it say it all about the double standards of this prime minister?" Mr Miliband said.

"If he fails to order a judge-led inquiry, people will come to one conclusion: he can't act in the national interest."

Mr Cameron condemned the "spivvy and probably illegal" activity in the rate-fixing scandal but repeatedly rebuffed Mr Miliband's suggestion that a public inquiry was the best way forward.

He insisted his preference for a parliamentary inquiry would provide a "swift and decisive" investigation.

The House of Lords voted against a public inquiry, Mr Cameron noted, and the government had made time for a debate in the Commons on Thursday, when MPs will be able to decide whether a parliamentary inquiry or a judge-led inquiry is the best option.

He urged the opposition leader to accept the decision of the Commons.

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