A late-night meeting in David Cameron’s hotel suite led the Tory leadership to offer Gordon Brown a political ceasefire over the banking crisis, George Osborne reveals in an interview with The Times today.

Mr Cameron, his Shadow Chancellor and William Hague gathered on the 23rd floor of the Hyatt hotel in Birmingham as the scale of the fallout from the US Congress’s failure to agree a bailout became clear.

Appalled by the partisan bickering in Washington, Mr Osborne said that they felt a duty “as part of the political leadership” of Britain to offer assistance to Mr Brown and help to rush through new banking regulation laws.

The Tory chiefs had watched the vote live on television and cancelled a planned tour of the party conference receptions to decide how to respond.

“There was definitely a big change of mood when people saw what was happening on currency markets and in America,” Mr Osborne said, recalling the meeting on Monday night.

“What happened was brought about by partisan division and point-scoring. As members of the British Opposition we just thought sitting there and discussing this, that was not right. We thought that, at this moment when people are anxious and nervous about their jobs, this is not the moment people wanted to see British politicians having a go at each other.” Mr Osborne was talking to The Times minutes after emerging from a meeting at the Treasury with Alistair Darling that was arranged after Mr Cameron’s call to Mr Brown, offering his support.

He said that Mr Darling had responded “pretty warmly” to offers of help in the Commons. The Chancellor told his shadow that it would “be extremely helpful” to know that a planned Banking Bill could make its passage through Parliament quickly.

“We will never be good friends. We want the same job, after all. Nevertheless we both understand that we have got our roles to play in reassuring people,” said Mr Osborne.

He joked that Mr Darling had responded to the offers of a ceasefire by failing to call him a “novice” – a reference to Mr Brown’s dig at Mr Cameron during his party conference.

Mr Osborne promised Mr Darling that he would not stand in the way of getting the Bill – to be introduced on Monday – through Parliament by February, when it is needed to replace emergency legislation used to nationalise Northern Rock and Bradford & Bingley. He and Mr Cameron agreed to drop, for now, Conservative objections to the legislation, including their demand that the Bank of England rather than the Financial Services Authority be given the power to trigger action on failing banks.

In addition, he promised to back moves to increase protection for savers, raising the guarantee from £35,000 to £50,000 and ensuring that cash was paid out within a week.

Finally, the Tories are backing moves for a temporary suspension of accountancy rules blamed for helping to drive down the value of bank shares.

Mr Osborne defended the leadership against accusations that it had changed tack only to increase media coverage of a conference in danger of being overshadowed by the crisis.

Admitting that he had used his speech on Monday to “have a go” at Mr Brown, he said that he was never “at full throttle”. Most of it had been a pretty sober assessment of the British economy, he said, claiming that it had been “90 per cent” positive.Asked how long the bipartisan approach would last, he said: “I don’t regard it as a truce but as an agreement. Faced with this enormous economic instability and national anxiety, it makes sense for the two parties to work constructively to improve banking regulation and restore stability to the system.”

He promised to return to the fray with “full gusto” when the crisis had passed: “There will be plenty of time for a post mortem. Now is not the moment. We have to play our part as part of the political leadership of this country.”

Mr Cameron will today test the new consensus with a barely coded attack on Mr Brown’s character, saying that the offer of help will not stop him from “being critical of the decisions over ten years that have led us to this point”.

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