Tony Blair has said Britain must not "hang bankers at the end of the street" in response to the financial crisis as he admitted partial responsibility for failing to prevent the crash.
In an interview with the Daily Telegraph on Tuesday , the former prime minister said that while his government failed to regulate the financial sector properly it would be wrong to let the state intervene too much in the City.
''We must regain the basic values of what society is about,’’ he said. ''We’re not against wealth, but we are in favour of social responsibility.’’
But he told the paper the it would be wrong to think society would better off ''if we hang 20 bankers at the end of the street’".
''Don’t take 30 years of liberalisation, beginning under Mrs Thatcher, and say this is what caused the financial crisis... Wrong!’’
He added: "We didn’t understand properly the true implications of the financial instruments involved, and so we didn’t supervise and regulate them properly. But we mustn’t go back to the state running everything."
Blair's comments come just days after he acknowledged he bore "a certain responsibility" for the economic crash that began in 2008.
Asked by Sky News on Sunday if that meant Labour did not fully understand it while he was in power, he replied: "No, we didn't."
Blair also issued an apparent warning to current party leader Ed Miliband who wants Britain's banks dramatically reined in, telling the broadcaster a "vibrant" financial sector was important for the UK.
"A vibrant financial sector is also a very important part of our future. Take the necessary steps but realise that thriving and healthy banking sector is a major part of the modern British economy and will also be so," he said.
Blair is said to be attempting a re-entry into British politics after five years spent working abroad or on private business.