Waiting game begins for thousands of North East Rock employees

Feb 18 2008 By Andrew Hebden

NATIONALISATION has loomed large for Northern Rock since the scale of the crisis facing the bank emerged last September, but that did not detract from the sense of shock felt when Alistair Darling announced the move at 4pm yesterday.

It was perhaps the timing that raised most eyebrows, with even those closest to this extraordinary saga caught off-guard.

BBC business editor Robert Peston – who has broken most of the major developments in this story – reported the decision on his blog less than an hour before Mr Darling addressed the Press.

What ultimately forced the Chancellor’s hand at this moment is not yet clear. But, as the major banks begin their reporting season in earnest over the next few days, we shall perhaps know more as the week progresses.

Timing is everything now, especially for the near-6,000 workers in the North East who will be fearing for their futures this morning. The Government insists it is committed to a private-sector solution for the Rock but a sale is only likely to come once market conditions improve and the truth is no-one knows when that may be. The economy is a notoriously difficult beast to second guess at the best of times, but right now even the sharpest minds in the field can’t agree whether we’re heading for a recession, never mind when things might start to pick up again. Figures issued this week by Barclays may guide us as to how bad – or otherwise – things are. Did Mr Darling have an inkling of what was pending? It seems absurd to think he did not and that may help explain the timing of his announcement.

History has shown that nationalisation need not mean the end. How long we must wait to learn whether the Rock turns out to be a Rolls-Royce or a Railtrack remains to be seen.