Nick Clegg raises Northern Rock and energy bills at Prime Minister's Questions

Liberal Democrat leader Nick Clegg has accused Gordon Brown of “jeopardising the interests of British taxpayers” over Northern Rock. Mr Clegg highlighted how the Government took too long to nationalise Northern Rock and is hiving off the bank’s best assets elsewhere.

Nick Clegg also called on Gordon Brown to act against “scandalous profiteering” by energy companies.

The exchange in full:

Nick Clegg: I welcome his [the Prime Minister’s] belated acceptance of the advice from the Liberal Democrats that the temporary nationalisation of Northern Rock was the only workable option available to him, although he now seems to be jeopardising the interests of British taxpayers all over again by hiving off the bank’s best assets elsewhere. Will he now admit that if he had acted sooner, he could have saved the taxpayer the tens of millions of pounds frittered away on bidders’ costs and prevented the untold damage done to this country’s reputation as a world financial centre?

Gordon Brown: I thank the right hon. Gentleman for raising the question of Northern Rock, which the Leader of the Opposition was reticent to raise, given that his party has six policies on the issue and has now decided on the worst possible option. As far as the Liberal Democrats’ policy is concerned, we were right to look at all possible options and we were right to invite private buyers to make offers. Because we will be subject to legal action, we were right to look in detail at every possible bid, and we were right to draw the conclusion, after considering every possible bid, that the temporary public ownership of Northern Rock was the best way forward. As far as Granite is concerned, I can assure the right hon. Gentleman that it will not affect the sale of Northern Rock to a private buyer.

Nick Clegg: Well, we might agree about the economically illiterate proposals from the Conservative party, but we disagree on why it took the Prime Minister so long to act on Northern Rock. Will he now agree to act in following our lead more urgently on another issue - namely, the scandalous profiteering by UK energy companies at a time when 25,000 people are predicted to die from the cold this winter alone? Does he realise those companies stand to make a £9 billion windfall profit from the European emissions trading scheme? Does he agree that that excess profit, equivalent to about £360 for every British family in this country, should be handed back to the neediest customers through lower energy prices?

Gordon Brown: I stress to the right hon. Gentleman that we were right to look at all possible options for Northern Rock before we took the decision that we did. If we had not done that, we would be subject to even greater legal action for not looking rigorously at all options. As far as energy is concerned, let me say that we are looking at the advice of the director general of Ofgem on that very matter. I have to say to the right hon. Gentleman that it was the Labour Government who introduced the w1inter allowance, which is helping thousands of elderly people. It was the Labour Government who raised it to £300 for the over 80s. It was the Liberal party and the Conservative party who opposed the winter allowance.*

Click here to read Prime Minister’s Questions in full
Click here to read Vince Cable’s analysis of the Banking (Special Provisions) Bill

* The Liberal Democrats argued at the time the Winter Fuel Payment was introduced that the money would have been better spent on an increase in the overall state pension. But at the 2005 general election the Lib Dems not only argued for the retaining of the Winter Fuel Payment but proposed to give it to a million people with severe disabilities and increase the basic state pension as well.
 
The Liberal Democrats have highlighted that the Winter Fuel Allowance now only covers 36% of the average winter fuel bill, compared with almost two thirds in 2003. The Winter Fuel Allowance is designed to cover the cost of pensioners’ winter heating costs, but because rises in energy prices have not been matched by a rise in the Winter Fuel Allowance, many pensioners have been left struggling to pay their bills.