Seems that the government has just sold on the main part of the 'bailed out' (aka state/taxpayer owned) Northern Rock to Virgin Money, effective 1st January 2012.
Since coming into 'our' ownership, Nothern Rock has been split into two
- Northern Rock Plc
- Northern Rock (Asset Management), into which was placed its bad debt.
Guess what ?
Yep, Virgin have bought the Plc part for £747 million)
Seems a good deal, until you realise that we the taxpayers 'bailed out' Northern Rock for over £1.4 billion.
Though on top of the £747m there is the potential for the Treasury to receive a further £280m over the next few years.
Can we please have Rt Hon Michael Gove MP moved from Secretary of State for Education to replace Chancellor of the Exchequer: Rt Hon George Osborne MP, because I'm pretty sure that being in charge of Education his maths skills will be better, as £747m + £280M does not equal £1.4 billion.
The Chancellor of the Exchequer, the Rt Hon George Osborne MP said: "The sale of Northern Rock to Virgin Money is an important first step in getting the British taxpayer out of the business of owning banks. It represents value for money; will increase choice on the high street for customers; and safeguards jobs in the North East."
Which part of value for money doens't he understand given that £1.4b - £747m - possible £280m = £373m loss to the Taxpaper ?
Granted George obviously has other things to worry about, so 'our' investments in financial institutions such as Northen Rock, Royal Bank of Scotland, Lloyds TSB, etc. being managed at arm’s-length by UK Financial Investments Ltd (UKFI). However the UKFI’s mandate requires it to achieve value for money for the tax payer.
So that's alright then and George is 'off the hook'.
Ho but hang on isn't UKFI a Companies Act Company ?
and isn't the HM Treasury as its sole shareholder ?
and aren't the company’s activities governed by its Board, which is accountable to the Chancellor of the Exchequer ?
So that makes George still firmly 'on the hook' in our book, might be worth asking him where the rest of our money is ?
And it gets worse.
Remember this is just for the Northern Rock Plc part of the deal, that still leaves us all owning Northern Rock (Asset Management), where size of the losses contained in the bad bank part of Northern Rock are still uncertain, but could amount to as much as £21bn.
No wonder the government has said 'it had no plans to sell Northern Rock (Asset Management), don't think we could all collectively afford any more of these value for money sales ideas of Goerge Osborne and his chums/appointees in UKFI.