'Prime Minister wants swift bank charges compensation'

The Prime Minister has called on current account providers and the regulator to urgently 'negotiate' to prevent payout delays if bank charges are ruled unfair.

Gordon Brown spoke out on overdraft penalty charges for the first time in a letter to MoneySavingExpert.com received today.

This came after site founder Martin Lewis wrote an open letter calling for the Labour leader to support this site's campaign to ensure automatic payouts for those hit by unfair fees of up to £39 a time for exceeding their overdraft limit.

The PM has asked all sides to ensure speedy compensation if the Supreme Court next month confirms earlier rulings that fairness rules apply to these fees.

If they do apply, the Office of Fair Trading (OFT) will decide whether charges actually are unfair, though it's already provisionally said it thinks they are unjust.

Already, over a million reclaimed cases are on hold, with more expected to join the queue.

The steer from Number 10

Martin Lewis was also called by a senior Number 10 aide today, and afterwards said: "This is a major signal bank charges has been pushed up by the Government agenda".

"Assuming the Supreme Court rules that the fairness rules apply, as the OFT's already indicated it believes charges are unfair, it's game on".

"Yet the worry is banks will mount a further legal challenge to the OFT ruling, traipsing through the court again, and this is where the PM comes in". By pushing for a negotiated settlement we could get a quick solution.

"This type of settlement will mean reclaimers wont need to go to court or the Ombudsman. They will simply be able to write tot heir provider and request a pay back".

"While still a triumph, I believe it should go further still. As banks unfairly took peoples money without asking, they should be given it back without asking, otherwise we risk the illiterate or financially-phobic missing out. Other parties have gone further".

All party leaders have spoken out

Brown is the third of the three major political leaders to respond to MoneySavingExpert.com's request to state their bank charges policy and support swift recompense.

Tory leader David Cameron said last month compensation should be quick and that he will consider automatic payback of all charges and Lib Dem leader Nick Clegg has agreed to table a parliamentary motion calling for automatic payouts, if charges are ruled unfair.