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Banking (Special Provisions) Bill

Part of the debate – in the House of Lords at 12:00 pm on 21st February 2008.

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Photo of Lord Marlesford Lord Marlesford Conservative 12:00 pm, 21st February 2008

One of the points made by my noble friend Lord Forsyth was that the Minister answered virtually none of the questions that were raised at Second Reading yesterday. It is unsatisfactory in any case to be considering legislation at this pace; it is effectively an abrogation of the entire parliamentary system of legislation. To produce a Bill like this with lots of complicated issues in it and to have points raised that are then not answered is wholly unacceptable. The argument for haste has certainly not been made to overcome that point.

I wish to make a point that I made yesterday. As regards Granite, it was necessary for the Treasury to produce a quite complicated technical note explaining what it was. Granite is an important part of the structure of Northern Rock because it is the vehicle into which the mortgages are passed by the bank. It therefore contains many billions of pounds' worth of mortgages. The Government have repeatedly made it clear that they are not nationalising Granite and say that it is all quite separate. However, the technical note says that it is a commercial decision for Northern Rock whether to provide new mortgage assets to the Granite financing vehicle or whether to allow the vehicle to run off in an orderly way. That implies to me that the future of Granite is entirely in the hands of Northern Rock, and therefore in the hands of the Government.

I asked the Minister a question during his speech because I understood that there was another special investment vehicle called Dolerite, which holds the mortgage assets for the commercial properties of Northern Rock. When I raised that issue, he said he did not have an answer but he would find out, and he hoped to have an answer by the end of his speech. Not only had he not told me about Dolerite by the end of his speech, but he did not even mention it in his wind-up. These are perfectly legitimate questions to which we are totally entitled to have replies. The idea that the Bill should go back down the Corridor with none of the points that have been raised having even been replied to is unacceptable.