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Financial institutions will be able to borrow from the Bank of England on a short-term non-disclosure basis as the government aims to beef up the tripartite system’s power under new proposals in the government's draft legislative programme.

The 87-page document, which ranges from welfare to banking reform, stated the government's intention to give the tripartite authorities more power to intervene in the case of a bank falling into difficulties, namely with the introduction of an insolvency regime.

The draft programme also suggested removing the impediments currently in place, which prevent the FSA from sharing information with the Financial Services Compensation Scheme. It also advocates improvements to the FSCS in order to facilitate faster payout.

John Letizia, head of government relations for the British Bankers' Association, cautiously welcomed the draft programme, saying it reflected the important questions surrounding financial stability.

He said: "We expected these issues to be the core of this draft Bill due to the consultation document before it. However, the government will actually publish the Bill in the fourth quarter and this will firm up the details.

"While we believe it is right to concentrate on the security of the financial sector, it is difficult to reach any conclusions as there is so much volatility that the actual bill may be at variance to the draft due to unforeseen circumstances."

Elsewhere in the draft programme, the government is set to establish a savings gateway accounts scheme open to those on lower incomes. The state would match savings pound for pound and would be open to savers from 2010.

Housing was also examined by the programme, including measures to help first-time buyers with a pledge to make up to £200m available to purchase unsold new homes, either to rent to social tenants or to make available to first-time buyers.

For the first time, all first-time buyers will be eligible for the shared ownership scheme, subject to an income limit up to £60,000.

Michael Coogan, director general for the Council of Mortgage Lenders, said: "The government's announcement on shared equity means that its approach is now more logical, providing help based on the income rather than the occupation of buyers.

"It will remove an anomaly by which providing help for one group of less well-paid workers makes access to home-ownership more difficult for others earning similar salaries but working in different jobs."

Mr Coogan also supported the ability of the Bank of England to make non-disclosed loans to lenders on a short-term basis.

He said: "This will give the Bank of England greater flexibility to respond to credit market conditions. Lenders believe the Bank should be able to respond flexibly to changing conditions in credit markets."