Northern Rock debts row
EMERGENCY legislation to nationalise Northern Rock is expected to become law today amid warnings the taxpayer was being saddled with the bank’s bad debts.
The Banking (Special Provisions) Bill is expected to receive the Royal Assent after completing its remaining stages in the House of Lords, having been pushed through the Commons in a single day on Tuesday.
Ministers were forced to fend off claims yesterday that the taxpayer had been left with the “rubbish” while the bank’s high-quality mortgages had all been sold off.
It followed the disclosure that Northern Rock had been selling off mortgages through Granite, a separate company used by the bank as a financial vehicle to raise funds. In a letter last night to Liberal Democrat treasury spokesman Vince Cable, Chancellor Alistair Darling insisted such arrangements were not unusual and posed no barrier to the nationalisation. But after a meeting with Mr Darling, Mr Cable said he was not reassured and called for a full audit of Northern Rock’s assets.
