The Liberal Democrats have called for the short-term nationalisation of Northern Rock as the best way to safeguard taxpayers’ money.
In a Parliamentary debate this week, acting LibDem leader Vince Cable branded the current bids for Northern Rock as “fantasy” and suggested that nationalisation would be the least worst option.
He said the Government was left with two unpalatable alternatives – liquidating the bank or short-term nationalisation.
“Should not the Govern-ment therefore consider temporarily assuming full control of the bank? That would eliminate the conflict of interest and it would provide a breathing space,” he said.
Chancellor Alistair Darling rejected the move as “short-sighted and foolish” at this stage although he said the Treasury has not ruled it out completely. He said: “Would it not be better to use the time we have to establish whether those expressions of interest can be translated into a firm proposal that would both help the company and, crucially, protect the public interest?”
Treasury select committee member and Labour MP Jim Cousins said: “The LibDems have as much regard for the employees of Northern Rock as they had for the job of their former leader.”
Lansons Communications director Ralph Jackson says: “The Government is focused on the current bid proposals to provide the best possible outcome for taxpayers.”