Not Fit To Run A Northern Wreck Whelk Stall

Northern Wreck has lived up to its nickname with the spending watchdog confirming what many knew all along, the hapless bunch at the treasury weren't fit to run a whelk stall, let alone oversee the taxpayers' takeover of the Rock. 

A damning National Audit Office report has exposed the monstrous cock-up, as ministers hid the scale of the bill which taxpayers were being asked to pick up. 

Even the BBC's business editor and treasury moonlighter, Robert Peston, reckons the report was embarrassing for Brown and Darling as "a spotlight has been shone again on their misjudgements". Though adding the caveat: "none of which will surprise you". As if that miraculously makes it all right. 

"We've known for many months that they were wrong on these very big issues," he added, cryptically.

The Orange Party is mystified as to the identify of the royal "we" to which Pesto refers. 

With an election round the corner, the Tories are spitting blood over biased BBC coverage, with Cameron's warning dirty tricks would be used against them by New Labour. It seems they are already happening.

On the day the public deficit soared by £9 billion and Cameron made a key-note economic  speech, the BBC evening news bulletin was blocked out with three "news items" padded out with time-filling back reporting, before Cameron even got a mention. And only then as a fag end, dropped into a long-winded report on the axing of the Motor Show. 

Today the BBC is reluctantly reporting the Rock, allowing Brown to take centre stage, droning on about "doing the right thing" in what was a gross error of judgement. 

The NAO found the treasury still allowed Northern Crock to lend £800 million in risky 125% mortgages for six months after it was propped up with taxpayers' cash.

And the treasury was aware of "potential shortcomings" in how to deal with failing banks as far back as 2004, when Brown was chancellor. Even the Telegraph was sounding a warning back in 2007 with this ominous profile of then CEO Adam Applegarth. 

That begs the question: Why didn't the treasury demand an immediate stop to the reckless lending that got the bank into trouble in the first place?

True to form Brown's deputy Mandelson has been spinning away and reckons "saving Northern Rock, stabilising it, turning round the business as we are doing now is the right decision." 

But the NAO slammed the treasury for not thoroughly checking out the bank's finances before nationalising the bank. And the report reveals greater scrutiny would have uncovered a much higher level of mortgage arrears than the Rock had previously been admitting.

Months of dithering around led to "major due diligence failures at the Treasury both before and after nationalisation" which has resulted in the bill for taxpayers being even bigger than was previously thought.

By the end of December 2008, 33% of all Rock mortgages had fallen into negative equity and with arrears mounting up, the treasury had to give it a further £3 billion financial cushion in July 2008.

Despite all the taxpayers cash, Northern Rock recently announced a loss of £1.4 billion for 2008. LibDem economic oracle, Vince Cable, branded it a disgrace: 

"With billions of pounds of public money at stake, the least taxpayers should expect is that basic due diligence of the company's loan book should have taken place before nationalisation."

Often what Cable says gets lost in translation. A monstrous cock-up at the taxpayers expense is equally close to the truth. 

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Get A Grip Darling, Taxpayers Are Revolting

Taxpayers and bank jobs will be hit as RBS is shored up in Brown's biggest ever bank bailout, while the former boss trousers a £650,000 a year pension and the company announces the biggest annual loss in UK corporate history. But taxpayers own 70% of the bank, so who's looking after the shop? 

RBS, which was bailed out last year, today announced an eye-watering loss of £24 billion and a shake-up which did not rule out substantial job cuts.

Meanwhile former RBS chief executive, Fred The Shred Goodwin, is already drawing a pension of £650,000 a year, despite being in his prime at 50, in a pension pot worth £16m. Nice work if you can get it and Brown's City pals certainly can. 

Hapless chancellor Darling reckons he only knew about the obscene pension pot after the BBC blew the whistle.

Both Darling and the treasury ministers looked like startled rabbits caught in the headlights and have promise to "look into the legal contracts." 

Darling told the BBC Today programme that when he found out it was very clear he had to go back to RBS to see who agreed this and why they agreed it and whether they have grounds to claw some of it back. Bolting horses and stable doors spring to mind. 

And, in what must take the prize as the understatement of the year, Darling added: "People will find it very difficult to understand how you can get paid £650,000 a year for the rest of your life when you look at the state RBS is in at the moment.

Er, too right. Ministers must have known this when they took over the bank back in October. If they didn't, they should have as they pumped in billions of pounds of taxpayers cash. After all, the pension was, in part, public money. That pension should have been stopped in its tracks then. 

Weasel words from the chancellor cut no ice with voters. Tear up the contract, call his bluff. No one wants their dirty washing hung out in public. You won't see Fred the Shred for dust as he sails off into the wild blue yonder, never mind in court. The Orange Party suspects treasury ministers have something to hide - how much did they know about Sir Fred's pension pay-off? 

Just to rub salt in the wound, the bulk of RBS losses came mainly from its disastrous 2007 takeover of ABN Amro with Goodwin at the helm.

These bank bail-outs are getting bigger by the day. Taxpayers are screaming enough is enough. The Orange Party loves it when the BBC's Robert Peston talks technical. A treasury stooge, sure, but he's a dab hand at the banking science bit: 

"The Treasury has announced that we as taxpayers will provide insurance to Royal Bank against future losses on £325 billion of loans and investments.

"First losses of up to £19.5 billion on those impaired assets will be taken by Royal Bank. But to prevent the losses wrecking the bank, we as taxpayers will be injecting up to £19 billion of new capital into it, in the form of non-voting shares.

"Also, losses greater than £19.5 billion will be born by us - by taxpayers. In a prolonged severe recession, those losses could be substantial.

"What we're getting in return is a £6.5 billion fee - in the form of yet more of these non-voting shares. And RBS has given a legally binding commitment to increase lending by £25 billion in 2009.

"We already own 70% of Royal Bank - and that stake could rise to a maximum of 75% after today's deal with the Treasury. Now the Treasury has announced that we as taxpayers will provide insurance to RBS against future losses on £325 billion of loans and investments."

Lloyds Banking Group is also expected to take part in the scheme, which could see taxpayers guaranteeing up to £600 billion worth of toxic debt as the government continues with its reckless borrowing binge and saddle taxpayers with a burden of debt for decades to come. 

RBS also announced a "sweeping" shake-up of the group's business as it aims to cut costs by £2.5 billion a year.

Translated into English that means job losses. A high price to pay for bank staff and the taxpayers but clearly not as high as the pension pay-off.

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Taxpayers Saddled With B&B's Bad Bits

Taxpayers look set to be saddled with Bradford & Bingley's bad debts, as it emerged the government is planning to nationalise the ailing bank. B&B is just the latest casualty of the false economic boom, relying on the buy-to-let market and self-certified mortgages to make a fat profit. 

Now the cash to prop up the toxic debt side of the business has dried up, the bank is looking to its pals in government to help it out. 

With no chance of anyone buying up all the whole of bank, bad debts and all, the cunning plan would be to use billions of pounds of taxpayers cash to buy up the bank, then sell off the profitable savings side of the business to a predatory buyer. 

That leaves the government and the taxpayers with the toxic 'bundled' bad debt side and the defaulters.

The BBC's Robert Peston, who seems to be moonlighting for the treasury these days, reports that the bank will be nationalised using special legislation the Treasury put through when it took Northern Rock into public ownership earlier this year.

But the public have no appetite for another Northern Rock which made huge profits during the good times, leaving customers saddled with debt. Taxpayers won't stomach taking on the liability of Bradford & Bingley as well as the Rock.

In the US, Bush's much-vaunted $700 billion bail-out deal hit the rocks when voters reacted violently to the thought of their tax cash being used to bail-out bank shareholders and executives, while millions suffer under the sub-prime housing misery. 

Few would begrudge the government for protecting the savings part of the business and cushioning the blow for lenders faced with unrealistic debt. 

But the buy-up move is the latest in a string of government measures to dig itself out of a hole, after creating the false 'booming' economy. 

Buying up B&B and just selling off the best bits will leave people asking just how far is this government prepared to go, to mask its economic incompetence and keep its pals in the City sweet. 

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Give Brown A Break (A Very Long One)

It's not been a very good week for Brown, now more unpopular than since polling began in 1943 - which makes the prime minister more unpopular than Hitler. But ringing people up at 6am isn't the way to get round people. 

That bold plan to tackle knife crime with, er, posters, just doesn't quite get to the bottom of the problem, does it? And having your picture taken with a couple of fat cats from two-bit oil producers is hardly going to win over the voters.

Yes, we all know the story. You were hoodwinked by the New Labour gang - taken in by the public school boy charms of Blair, the Campbell spin and that devious sod Mandelson - but weren't we all! All those words and slogans made so much sense at the time. Words like 'modernising' and 'narratives' and things.

And we all know that Blair only went if you promised not to mess about with foreign policy, domestic policy - if fact any New Labour policy - and just stuck to speeches on global warming.

You see, you have to learn not to take it too personally. It's New Labour and the decade of lies, deceit and failed policies that people don't like. Yes we all know you were there at the beginning of the Project but, like now, you didn't touch it, meet it, sign it or do anything - did you?

So let's be positive now Gordon. You did a great job at the treasury selling off our Gold Reserves at a knock down price, creating a live now pay later debt culture and keeping all that naughty spending hidden away off the balance sheet - it looked great on paper and made everybody feel good at the time.

But you know, all good things must come to an end. So why don't you just bugger off back to Scotland and give us all a break.

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