GEORGE Osborne has been urged not to use any pre-election sale of the public share in Royal Bank of Scotland and Lloyds Banking Group to win votes.

He has instead been urged to get the best possible return for British taxpayers, whose bailout of both banks topped £65 billion.

The call has come from Labour's Lord McFall of Alcluith, a member of Westminster's high-powered Banking Commission, on the eve of the eagerly awaited publication of its 600-page report into banking standards. The report is expected to attack bankers for failing to provide a duty of care to their customers and failing to accept personal accountability.

The commission, made up of peers and MPs, was established following the Libor-rigging scandal and for the past year has been looking at ways to repair Britain's broken banking industry.

It is understood its report will call for a fresh review, within six months, to consider the options for RBS, 81% of which is owned by the taxpayer. These include splitting it into a good and a bad bank – privatising the former and nationalising the latter – and selling off shares to the public.

The Chancellor is expected to set out his intentions in his annual Mansion House speech next week, but Lord McFall was clear Mr Osborne should not play party politics with RBS. "In terms of selling off, political interests are being driven by No 10 and No 11 to give something before an election, but economics should dictate a sell-off – not politics," he declared.

In the Commons, Sajid Javid, the Coalition's Economic Secretary, sought to downplay the Treasury's involvement in the surprise announcement that Stephen Hester, the RBS Chief Executive, will be stepping down this year ahead of privatisation next year.

"The Chancellor has not been directly involved in meeting with Stephen Hester prior to the announcement of his departure," he told MPs.

Mr Javid also denied there was a "fixed timetable" for the sale of the UK Government's RBS stake before the 2015 General Election, and that the priority was ensuring best value for the taxpayer.

As the bank's share price fell on news of Mr Hester's forthcoming departure and the shedding of another 2000 investment jobs, there was speculation Sir Philip Hampton, the bank's chairman, might also be on his way out after referring to the need for "other aspects of board succession" to be addressed once Mr Hester's successor was appointed.

Lord McFall said the commission's report, which is due to be published in the next few days and has involved some robust exchanges of opinion, would not be a "magic bullet" to heal the banking industry.

He claimed senior bankers had hidden behind a curtain and failed to engage with the public. "There has been talk of many scandals in the banking industry but there is only one scandal - the industry has ignored the interests of the consumer," he said.

Referring to controversy over the misselling of Payment Protection Insurance, the Labour peer said: "Some of the evidence on PPI was unbelievable. For example, the former chief executive of Lloyds came before us in terms of PPI and said they were 'on the side of the angels'. Now the public would look aghast at that.

"Lloyds have run up £6bn in pay-outs. From the latest allegations this week we see they were turning a blind eye to the customer. Rather than being on the side of the angels it would appear Satan was stalking their corridors."