Clause 6 — Transfer of property, rights and liabilities

Part of Delegated Legislation – in the House of Commons at 8:30 pm on 21st February 2008.

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Photo of Jeremy Browne Jeremy Browne Shadow Minister (Treasury) 8:30 pm, 21st February 2008

Let me see whether I can get to that once I have concluded the two substantive points that I wish to discuss, the first of which is on the independent audit and the second of which is on freedom of information.

The Liberal Democrat position is that an independent audit is appropriate, and it is strengthened by the arguments that we have heard about Granite in this House and in the other place. There has been an extremely worrying development, because there still is no feasible alternative to nationalisation, but that does not mean that the Government can sweep the Granite issue under the carpet. Some £8 billion of unsecured loans are on Northern Rock's balance sheet, but none is on Granite's, so there is an imbalance that is potentially highly damaging to the taxpayer. We need a new valuation that gives taxpayers confidence that when we undertake to buy this company, we are buying a proposition that offers us a reasonable deal.

Commercial confidentiality is specifically excluded from the freedom of information provisions. The suspicion must be that the Government think that there is something to hide and that they would rather not be exposed by freedom of information. Northern Rock would have benefited from more rather than less scrutiny over the past few years. Some companies in the public sector that have commercial rivals are subject to freedom of information provisions. Royal Mail is a case in point—it competes with independent, private courier companies—and National Savings and Investments is another example of the phenomenon.

Northern Rock is looking to engage very expensive consultants and it might well pay bonuses to staff, so it seems only reasonable that we are in a position to know the scale of the undertaking being made by its management. The Minister says that the problem is that as this is only a transitory condition and the company will be sold back to the private sector—she was not specific on the precise time scale—it would not be appropriate to subject these measures to freedom of information. Of course there is nothing to prevent the Government from reintroducing provisions to exclude Northern Rock from freedom of information measures when it is sold back into the private sector. We have no assurance of when that will be, and it is surely much better to act on the precautionary principle and for the Government to support the relevant amendment.

In conclusion, the Government are taking an extremely high-handed approach on this matter. The Liberal Democrats have sought to be a wise counsel and good friend to the Government throughout their difficulties over the past five months. That is entirely the spirit in which, in the other place, we supported the amendments before us this evening. We are not seeking to play opportunistic games. We seek to make the legislation, which is being introduced in short order, better than it would otherwise be. Rather than setting their face against good advice from my party and the Conservative party, the Government would do well to be less stubborn and to heed the warnings that we have given them in the past and are putting before the House this evening.