Vince Cable today launched a vicious attack on rampant capitalism as he unveiled new laws to rein in reckless and greedy City fat cats.

The Business Secretary – who is often thought to be the unhappiest Liberal Democrat minister in the coalition – promised tough Government action against what he described as “the murky world of corporate behaviour”.

Mr Cable is known to be concerned by corporate controversies ranging from the Enron scandal and the behaviour of oil giant BP to the takeover of Birmingham-based chocolate-maker Cadbury by US food giant Kraft.

In a move to calm the jitters of many Lib Dem activists who have questioned the compromises leader Nick Clegg made in order to forge the coalition with David Cameron’s Conservatives, Mr Cable insisted he would not take a “laissez-faire” attitude to business.

He announced a wide-ranging probe into “murky” corporate activities and hostile takeovers to curb the influences of “short-term investors looking for a speculative killing”.

He condemned markets as “often irrational, or rigged” and warned unrestrained capitalism “kills competition”.

In a speech which will alarm the party’s Tory partners on the final day of the party’s annual conference in Liverpool, Mr Cable laid into big business executives and directors.

He told delegates: “The principle of responsible ownership should apply across the business world.

“Let me be quite clear – the Government’s agenda is not one of laissez-faire.

“Markets are often irrational, or rigged. So I am shining a harsh light into the murky world of corporate behaviour.

“Why should good companies be destroyed by short-term investors looking for a speculative killing, while their accomplices in the City make fat fees?

“Why do directors forget their wider duties when a fat cheque is waved before them?

“Capitalism takes no prisoners and kills competition where it can.”

Employers group the CBI accused Mr Cable of using “harsh” and “emotional” language.

CBI director-general Richard Lambert said takeovers could be a force for good, enabling “poorly run businesses” to pass into more efficient hands.

Mr Cable insisted he was “pro-market” and “totally committed” to encouraging a private sector recovery, but added businesses also had responsibilities and needed to think long-term.

Yesterday, Mr Clegg promised tough action against tax evaders, new levies on banks and City bonuses.

The party’s deputy leader Simon Hughes also held back no punches and urged his party not to abandon its manifesto pledges without a fight.

Relishing his role as a voice independent from the government machine – he said the party could no longer “be ignored” and were now “in the game”.

And while he insisted he was “a rock solid” supporter of the coalition, he warned the party’s Tory partners that Lib Dems would not “back off” from cherished policies.

By London Reporter Sunita Patel