Rock bottom

The Northern Rock saga drags on. It’s one of those stories which dropped from the headlines but is far from solved. Vince Cable and the Lib Dems have been alone in making the case for nationalising Northern Rock, not to run it permanently, but to limit taxpayer losses and get the bank in shape for a new owner. It would also be the best chance to support Northern Rock employees and charitable projects in the North East.

In November, the taxpayer subsidy was reckoned to be £900 each, a huge sum in the circumstances. I even did a photo posing with a giant £900 sign to make the point. Sadly my photo is already out of date.

The BBC reports that Northern Rock has been given about £26bn of Bank of England emergency loans, but with government guarantees to savers and other lenders, the total aid package underwritten by the taxpayer comes to more than double that. So the individual taxpayer bill is now at least £1500.

The Government may talk about tackling inflation but this is one price rise that’s out of control.

Worse still, we don’t exactly how much has been lent, if we’ll get it all back, and if the bank will pay interest. If only my bank manager took the same generous approach to my personal liquidity crises….

Back in December, Labour MPs voted through a motion which “notes the Chancellor’s assurance that he will keep the House fully informed of further developments with regard to Northern Rock.” But now all the Treasury will say is “the terms and conditions of the facilities are confidential.”

Nationalising Northern Rock is finally on the Government agenda, although probably too late to get back all the public money lost.

Am I wrong to see a message in today’s TV schedules: ‘Deal or No Deal’, ‘Mission Impossible’ and ‘Move over Darling’?


1 Comment »

  1. […] to criticise the Government of the day whatever they do. On Northern Rock, there’s been plenty to criticise. This time the Treasury has made the right decision. Which is why it’s the option Vince Cable […]

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