Banking (Special Provisions) Bill

I am sorry; I cannot give way any more. The business plan is the key issue. We as politicians have offered the country some advice in this debate, but I do not think that we are the best ones to judge what the business plan should be for Northern Rock. Others who are more qualified and know the details of running a business—the risks, the responsibilities and the rewards—are far better placed to make recommendations about the future business plan for Northern Rock. I hope that when the board does so, it will hold close consultations with the workers and their trade unions. The workers have been remarkably loyal over the past five or six months, during a period of great uncertainty. The workers still have huge anxiety about their future, so I hope that there will be no great delay, and that we will move forward quickly on that issue. I have said that I do not think that politicians should outline the business plan, so I will not do so, but one of the key questions that has to be taken up by the board is: what is the marketplace? There is no easy answer to that, because the board has to judge not the marketplace of the past—which it could look back on—or that of today, next month or even next year. It has to take decisions on a much longer term. Mortgages last a long time, and they have to be financed. That is a key issue for the board, and there is no clear-cut plan. The right hon. Member for Charnwood (Mr. Dorrell) said that there was not enough clarity, but I do not think that we can have that clarity. In some senses, we have to take it on trust that the board will come up with commercial thinking, balanced against the principles of accountability—for which, of course, the Government are responsible, as there are vast amounts of public money at stake. The board cannot even say, ““If we take out this mortgage book, this is how it will be financed.”” It cannot say whether such a book will be financed entirely from deposits, or from a mixture of deposits and other loan finance, because it does not know what the international wholesale money markets will be like in future. It will therefore have to plan conservatively, using an option that allows it to develop the business if the markets change. It will have to face up to that key issue. There is no certainty for the board in the decisions that it will have to reach. The board will have to decide on the shape of the business, based on the long-term future. It will have to consider how many retail units it needs, whether high street retail banking will be the way forward or whether internet banking will take off to a greater extent, and whether it wants to be in the internet banking sector. It will have to consider what sort of back room it needs. For example, will it need large numbers of people working in call centres, or are there other ways in which the business can be developed? Those are crucial decisions for the future of the business, and there are no clear-cut or certain answers at the moment. The board will have to decide on the number of people whom it needs to employ. Again, that will be a difficult issue for it to face up to. Northern Rock has grown at a remarkable pace in employment terms; it has gone from 4,000-odd members of staff in 2003 to more than 6,000 today. That was during a period of growth. I discussed the issue with the trade unions at lunch time, and they are aware of all those considerations. The board will have to decide on its staffing requirements for the longer term. Earlier in the debate, I raised with the Chancellor the issue of the repayment terms that the Government can expect, and the period over which repayments will be made. It is almost impossible to answer that question with great precision. One could make a political statement and say that the repayments would be made over a certain period, but if that was not in line with the commercial operation of the business, there would be severe consequences, so there has to be some flexibility. That is why the business is in the public sector at this stage—so that the repayments that must be made, and made with interest, can be made over a period. That is vital, not only for the taxpayer, but for maintaining the business as a going concern. Hopefully, the business will go forward in a positive way, as was said by my hon. Friend the Member for Newcastle upon Tyne, Central (Jim Cousins), who represents a constituency that neighbours mine.