POLITICIANS from across the political divide have said the deal to sell Northern Rock to Virgin Money raises significant questions.

The lender, which was nationalised in February 2008 after the first run on a UK bank for 150 years, has been sold for £747m but this figure could rise to around £1bn with add-ons.

Chancellor George Osborne insisted the deal was the best available for the taxpayer and would ensure a "powerful new presence" in high street banking.

However the sale price is less than the £1.4bn injected by the Government during its public ownership.

Delivering a major speech on the economy in London, Labour leader Ed Miliband said: "There will be serious questions asked about the deal done to sell Northern Rock today, and in particular about the losses to the taxpayer.

"But whatever the right decisions about the timing of that - and we will scrutinise it - there does need to be greater competition in the market."

He added: "We need a more competitive banking system so there is genuinely a challenge to existing players in business lending."

Tory MP Mark Field, who represent the Cities of London and Westminster, criticised the sale saying the Rock was sold "for a song''.

"I’m very concerned about whether we are getting really good value for the taxpayer," he said.

"There has to be a sense that Richard Branson has got the deal he was craving four years ago for a song today."

Mr Field added: "When one looks at the track record of Mr Branson he tends to make pretty good deals and I suspect he knows this is reasonably good."

He said it was "regrettable" ministers did not wait for a viable plan to remutualise Northern Rock, and feared today’s deal paved the way for Government shares in Lloyds Banking group and Royal Bank of Scotland to be sold cheaply.

Financial Secretary to the Treasury Mark Hoban said no plan to remutualise the bank was tabled and insisted the deal came at the right time.

"We reached out to the mutual sector... saying come forward with a workable plan to remutualise Northern Rock and sadly no-one did, so that’s why we have had to go down this route," he added.

"The judgment we reached was that it was best to sell Northern Rock now, that holding onto it for a few more years wasn’t going to realise an increase in value for the taxpayer."

He said today’s sale ended uncertainty over the bank, "removing a huge shadow" from staff.