In a press conference today, Cameron said: “As soon as the legislation goes through parliament the Prime Minister must restructure his Government. He needs to have a Chancellor with credibility, and he needs to do it quickly.
“The Chancellor has taken a course of action which he admitted would lead to a slow lingering death for the jobs of the Northern Rock workers a slow lingering death for the assets of that Bank and a slow lingering death for Britain’s reputation as a major financial services centre. All this, with himself cast in the role of undertaker.”
He maintained that the Tories would not support the nationalisation claiming it was “a disaster for the British taxpayer, a disaster for this Government and a disaster for our country”.
Cameron said the Government could have rescued Northern Rock the weekend before the run if it had taken the offer by Lloyds TSB, during the run if it had made the guarantee sooner as advised by the Governor of the Bank of England, or after the run selling the assets when the market was better and company’s value was higher.
He said: “Ever since this crisis started, this Government has been wracked by
dithering, delay and indecision.”
Gordon Brown said today the Chancellor had made “the right decision, at the right time, for the right reasons” adding that the Government would have failed taxpayers if it had not listened to private bids.
Conservative Shadow Chancellor George Osborne said the Government should have gone down the bank-led reconstruction route he had repeatedly suggested which would see it in public administration and managed by the Bank of England.
But Liberal Democrats Shadow Chancellor Vince Cable, who has supported temporary nationalisation from the start, said the Tories’ belief that temporary nationalisation will be catastrophic is “nothing more than a vacuous attempt at political points scoring”.
He said: “Tory proposals that Northern Rock should be taken into public administration by the Bank of England is simply a nationalisation that dare not speak its name.
“The Government has finally realised that the temporary nationalisation of Northern Rock is the only way to safeguard taxpayers’ money. It is frankly ridiculous that this decision has taken so long. It is critical that we now look ahead to how this nationalisation can work best for taxpayers. The actual quality of Northern Rock’s assets must be assessed so we can decide whether it will be practical to continue to run the bank as a going concern.”