BBC BLOGS - Peston's Picks
« Previous | Main | Next »

Rock: Path to privatisation

Robert Peston | 18:29 UK time, Sunday, 30 March 2008

Corporate embarrassments don't come any bigger or more conspicuous than Northern Rock's near involvency last September, when it went cap in hand to the Bank of England for emergency financial support.

Northern Rock signWhich is why any severence payment to Adam Applegarth, the chief executive of the Rock at the time, was always going to spark controversy.

However the £760,000 he is receiving in monthly payments of just over £63,000 is less than his contractual entitlement.

And last December, when the board agreed Mr Applegarth's departure terms, even the Treasury was trying to persuade the world that the Rock had a future as a going concern in the private sector.

The Rock's accounts for 2007, to be published later today, will also show that it made a loss for the year of around £150m, largely due to writedowns of its exposure to US sub-prime through investments in Structured Investment Vehicles and Collateralised Debt Obligations.

Another controversial contributor to its loss was around £50m of payments to City firms and professional advisers made when it was struggling to avoid nationalisation - of which around £20m are costs incurred by the Treasury, the Financial Services Authority and the Bank of England, together with contributions to the expenses of putative bidders, led by Virgin and Olivant.

But it's by no means all bad news. Ignoring the exceptionals, writedowns and one-off charges, pre-tax profit emerges at about £420m for the year, sharply down on the £590m made in 2006, but indicative of a business with a future.

As for arrears on mortgages, they rose sharply – but the arrears rate remains about half the industry average.

Now in state hands, the Rock will also make a commitment later today that during 2010 it will have repaid all of the taxpayer-backed loan it has received from the Bank of England, which currently stands at around £24bn. Repayments have started and the loan is already about £3bn lower than it was at the end of last year.

The new nationalised Rock will say that after the Bank of England loans have been repaid, it will relinquish the guarantees the Treasury has given to other creditors.

And, finally, when it can be seen to be standing on its own two feet again, without the aid of any taxpayer crutch, it’ll seek a return to the private sector – either through a stock market listing or a sale to another bank or financial institution.

Also to be published will be a so-called “competitive framework” document. The point of this will be to reassure other banks that it won't compete with them unfairly, now that it is probably the safest bank in the world as a subsidiary of HMG.

The Rock’s chairman, Ron Sandler, will endeavour to allay rivals’ fears by pledging that his bank’s products will never again be at the top of best buy tables, unless and until it returns one day to the private sector.

UPDATE 17:00 It's going to get much worse before it gets better. That was one of the messages buried in Northern Rock's business plan.

Today the state-owned bank had the indignity of being the only big British bank to announce a loss for 2007

That loss of £168m before tax was largely due to the impairment of investments linked to US sub-prime loans, the notorious SIVs and CDOs

But more disturbing for those who take an interest in the health of British banks in general was a trebling in the amount the bank set aside to £240m in provisions for future losses on regular British mortgages and unsecured loans.

Northern Rock added that it expected loan losses to rise further, because falls in house prices mean that it will recover less of what it's owed when forced to take possession of properties.

And the bank fears what it calls "an increased propensity" of customers to default.

So in the current year the bank expects to be significantly loss making again, in part due to costs associated with its plans to halve its size.

What's more, it doesn't expect to break even again till 2011.

In other words, the path back to the private sector will neither be quick or painless.

Comments   Post your comment

  • 1.
  • At 07:41 AM on 31 Mar 2008,
  • Dee wrote:

Robert
You are very quiet on what is the effect of reducing the balance sheet to £50bn. I presume that the £50bn pushed to other lenders assumes that other lenders will want the assets.

With "static" house prices what percentage of the mortgagees will not be able to move because their mortgages are in excess of 80% of the value of the house? Surely the effect will be that the best assets move leaving Northern Rock with all the toxic loans. I can't see that being privatised in a hurry.

  • 2.
  • At 08:54 AM on 31 Mar 2008,
  • Tim Rossiter wrote:

Extra Liquidity - The £24B loan to Northern Rock was presumably used to pay off the loans it in turn had taken from other banks (rather than being needed to pay back savers).
Was it not in effect a £24B liquidity injection into the financial markets, and should be included with the various lumps the Bank of England has provided.

  • 3.
  • At 09:21 AM on 31 Mar 2008,
  • esai wrote:

So you think we shouldn't be too harsh on Mr Applegarth? An 8% cut in your payoff is acceptable punishment for bringing a bank to its knees?

  • 4.
  • At 09:34 AM on 31 Mar 2008,
  • Brian Anderson wrote:

Why no mention of the Shareholders Equity in the accounts as that figure divided by shares in issue is the minimum share price that Northern Rock Shareholders should expect in compensation from the govt.

  • 5.
  • At 09:53 AM on 31 Mar 2008,
  • John A (UK) wrote:

Why is it that the Granite offshore portion of NR was offered to private buyers of NR,but not included in the nationalisation? Why were the three advising companies in the attempted sale all American? Alastair Balls is Chairman of the NR charity foundation, is he related to Ed Balls?

  • 6.
  • At 10:22 AM on 31 Mar 2008,
  • John Portwood wrote:

Correct me if I'm Wrong - but the reason why the Rock was nationalised was because it needed £24 billion of liquidity - Yes

The BoE has put in an additional £25 billion of liquidity into the markets is phases and the other banks are demanding substantially more than this. In addition the Fed Reserve has put in £260 billion of liquidity into the American Markets!

Surely the banks demanding the extra liquidity from the BoE should also be Nationalised - or Northern Rock immediately privatised to ensure equal treatment?

  • 7.
  • At 10:32 AM on 31 Mar 2008,
  • Terry Bullard wrote:

As usual your reporter tries to justify the unjustifiable. Northern Rock was broke and had to be rescued at the taxpayers expense. The fact that the Chief Executive is receiving any payout is appalling, and the £50 million paid for 'advice' merely confirms the moral bankrupcy of the City,
Terry Bullard

  • 8.
  • At 10:44 AM on 31 Mar 2008,
  • John B wrote:

'Who gained most from the Rock's privatisation?'

When did that happen?

  • 9.
  • At 10:47 AM on 31 Mar 2008,
  • Robin wrote:

Is there any conclusion to be drawn from the photograph of Adam Applegarth in the Sunday Times sporting a beard?

Doesn't he want to be recognised?

I think we should be told.

  • 10.
  • At 11:46 AM on 31 Mar 2008,
  • Colin wrote:

So they are planning to halve the size of business very quickly but the staff (and therefore cost) reductions will only be 30% and will not be complete before 2011. The effect of this will surely be to increase the cost per pound of the assets and business.
This makes no sense unless the process is being entirely driven by political considerations rather than finance.

  • 11.
  • At 12:24 PM on 31 Mar 2008,
  • Tom Taylor-Duxbury wrote:

Asymmetry in the risk reward "equation" in banking is entrenched.
The banker wins heads or tails.
If Applegarth is a decent type, and bankers keep reassuring us that as a group they are, he should not accept this as a reward for his abject failings.
Everywhere we read NR was working with a flawed business plan. Most small businesses that fail as massively as this have the owners loosing their homes.

Asymmetry as I said

  • 12.
  • At 12:28 PM on 31 Mar 2008,
  • Guy Croft wrote:

Seems the man's contract was badly written. How about a clause that says 'if the back collapes (heck, I'm no expert) you get f* all!!

But I guess if contracts said that, they wouldn't be able to 'attract the best people'.. ho hum.

GC

  • 13.
  • At 12:32 PM on 31 Mar 2008,
  • Alan Hunt wrote:

Why aren't Director's remuneration packages expressed in terms of the value of a defined numbers of company shares at the end of each financial year? If a company does well, then they do well but if a company fails they share the pain. Performance-related pay at its purest and none could object!

  • 14.
  • At 12:42 PM on 31 Mar 2008,
  • G. Graham wrote:

If Northern Rock returns to profitability, it should go back to being a successful building society. That is what
its investors in N.E. England would prefer and would be in the best interests of the mortgage industry.

  • 15.
  • At 12:49 PM on 31 Mar 2008,
  • Richard wrote:

I think this should this be called "The Path to Nationalisation", shouldn't it? (n.b. I'm not trying to make a subtle point here, I think the title is genuinely incorrect)

  • 16.
  • At 01:03 PM on 31 Mar 2008,
  • Dave wrote:

I remain baffled by the economic doublespeak bandied around by financial professionals. NR is apparently anything between £24bn and £100bn in debt and yet it made £420m profit last year? Huh? Could this just be a notional figure intended to shore up the value of worthless shares so that shareholders can somehow shift their financial losses onto the taxpayer in the form of compensation?

  • 17.
  • At 01:19 PM on 31 Mar 2008,
  • Guy Croft wrote:

Pity his contract wasn't better written, like a clause that said 'if the bank collapses you get nuthin..

But I figure if the contracts for the 'top earners' said that they'd never 'attract the top people'.

This 'top earners' thing, it's some kind of club, right, where everyone gets er, 'taken care of' yeah?

Wish my world worked that way.

GC

  • 18.
  • At 01:20 PM on 31 Mar 2008,
  • Harry Pettis wrote:

So far as the £760,000 payment to Mr Applegarth is concerned, there is an old adage which is very applicable. "Steal a little, and they'll put you in Jail, steal a lot, and they'll make you a King"

  • 19.
  • At 01:22 PM on 31 Mar 2008,
  • Andy wrote:

Colin, NR have already lost over 1000 members of staff since September. So add that to the 2000 minimum more to go, and you'll see they've lost a far higher percentage of staff than you give credit for.

Political considerations? Don't make me laugh. The staff are the only people who've never been considered by anyone.

  • 20.
  • At 01:28 PM on 31 Mar 2008,
  • Mani wrote:

So what do you think that the x share holders may get in compensation????

  • 21.
  • At 01:29 PM on 31 Mar 2008,
  • Geoff Brown wrote:

Your latest report on Northern Rock makes interesting reading and for a change the tone appears to be quite upbeat about the Rock's future as well as for the rest of us taxpayers.

It was especially interesting to learn that Adam Applegarth's severence pay will be less than he is entitled to and this will be paid in instalments over quite a long period. In future it might be wise for the investment banks to make similar arrangements when paying out vast bonus payments to their employees. That might then stop them from taking silly risks in the hope that they can pocket the money before being found out. Then if the bankks fail at some stage in the future then they to will share the risk.

  • 22.
  • At 01:37 PM on 31 Mar 2008,
  • merce wrote:

Nobody will want the junk mortgages
that Northern Rock/taxpayer currently holds.

As housing begins to tank, and mortgages reset to higher rates, the
writedowns on these "assets" will skyrocket.

  • 23.
  • At 01:38 PM on 31 Mar 2008,
  • simon wrote:

Robert,

Why is Appelgarth not in jail for fudiciary neglegence? And the same goes for all the other Executive Directors. And for that matter, the same goes for those culpable at the FSA.

If this had happened in any other sector of business they'd be banged up in short order. Criminal.

  • 24.
  • At 01:39 PM on 31 Mar 2008,
  • Alan Hunt wrote:

Why aren't Director's remuneration packages expressed in terms of the value of a defined numbers of company shares at the end of each financial year? If a company does well, then they do well but if a company fails they share the pain. Performance-related pay at its purest and none could object!

  • 25.
  • At 01:54 PM on 31 Mar 2008,
  • Ashley Clarke wrote:

Why is nobody bothered about the poor mortgagees? We are being right royally ripped off in all of this. As fixed rate deals end we are being informed that our payments are going to become highly uncompetitive, to say the least, and advised to look elsewhere. In the meantime NR are insisting that over the top redemtion fees are paid for those who do depart, whic I imagine most must must surely do. Once loyal and reliable customers are the ones who are re-paying Applegarth's incompetence!

  • 26.
  • At 01:58 PM on 31 Mar 2008,
  • Dave C wrote:

"The Rock’s chairman, Ron Sandler, will endeavour to allay rivals’ fears by pledging that his bank’s products will never again be at the top of best buy tables, unless and until it returns one day to the private sector."

This is a rather obtuse comment isn't it? If Ron's not prepared to offer 'best buy products', how does he expect to create the turnover to keep the business viable, never mind repay all those loans?

If NR slashes savers' rates, they can expect another run on the bank as savers scurry to find better deals elsewhere.

  • 27.
  • At 02:21 PM on 31 Mar 2008,
  • Jason wrote:

So Gordon Brown's pal Ron Sandler pledges to repay all of the taxpayer backed loan by 2010. I wonder what else could be happening in Apr/May 2010 just as the final payback is being completed?

  • 28.
  • At 03:11 PM on 31 Mar 2008,
  • iain millett wrote:

If Northern Rock quite properly is to shrink its balance sheet whilst paying its savers top rates, it should withdraw the early redemption penalty which currently is stopping so many of its mortgage holders from refinancing at reasonable rates.

The usual process seems to be running where top management is bought off leaving customers to foot the bills.

  • 29.
  • At 03:18 PM on 31 Mar 2008,
  • ed.corbett wrote:

When Northern Rock "blew it' last year,they had outstanding mortgages in excess of £100 billion on which the mortgagees were paying their monthly payments representing approximately £3 billion a month or £36-40 billion a year.Somehow in the ensuing panic this seems to have been ignored.Now we are told that Northern Rock is actually making a decnt profit .The real problem at Northern Rock was incompetent management.
The "Masters of the Universe " were a bunch of clowns drowning in "Newcastle Brown".
The shareholders, who up to the crash were eminently satisfied with their "North Eastern" super Company ,are now realising that the world of business is fraught with danger and complacency is not an option when you are investing your hard earned money.
Ed Corbett

robert,
I understand your fellings about this but do not need to say things about them. they have payed the bill and that is all that matters, is'nt it? www.bbbcnews/northernrock/robertscomments.com

  • 31.
  • At 04:44 PM on 31 Mar 2008,
  • Ian wrote:

One law for the rich,another for the poor.Mr Applegarth will get his payoff because it is contractual.The fact that he did a rotton job matters not a jot.Nobody must tell HIM to go and whistle.

Then what about the shareholders?We are just passive,innocent parties but we were ARBITRARILY denied even our DECLARED dividend.Didn't WE have a contract.

  • 32.
  • At 04:46 PM on 31 Mar 2008,
  • Richard wrote:

The Business Plan put forward today is not different to any significant extent to the "back of the fag packet" calculation that was being done in September. Almost 6 months of drift whilst the problems in turning round the company have got worse, as shown by another 4 years (jam tomorrow forecast?) before it starts to make money.

  • 33.
  • At 04:51 PM on 31 Mar 2008,
  • Jason wrote:

So Gordon Brown's big pal Ron Sanders has promised that NR will repay all the taxpayer backed loans by 2010. I wonder what event in Apr/May 2010 could coincide with the news conference to announce that the repayments have been completed? Hmmmm.

  • 34.
  • At 04:51 PM on 31 Mar 2008,
  • Justin wrote:

Those who took the highest risk (LTV greater than 80%) will be either paying the punitive Standard NR rate, re-mortgage elsewhere at increased rate (Now the whole market has increased its mortgage rate for 80%+ LTV), or default and be repossesed.

As someone with an 83% (And shrinking) mortgage with NR due to expire May 2009, I have a keen interest in the non-competitive nature of the NR Mortgage rates. While I may be considered a "toxic loan" I think it perhaps unfair that I still have to pay early redemption fees to try and get away from NR (Which it wants 50% of its borrowers to do!) now, rather than wait until next year when house prices could have decreased by so much I cant move elsewhere... and I will have to pay 1.5% higher mortgage rate with NR.

The answer was simple - let it go to the wall and get asset stripped by the remaining market - my mortgage would have ended up with someone else, shareholders would have paid the price of gambling (Just as others accuse those with an LTV of greater than 80% of gambling on house prices!) and savers would have had their savings protected anyway. Nationalising is anti-competitive, and as has already been pointed out - surely other banks with cap in hand to the BOE should be facing nationalisation - if thats the course of action which should be taken.

Its obvious that at the end of this process and the credit crunch the bank actually has a strong ongoing concern - but some will have to suffer in the meantime...

I only hope that the principles of the UK housing market (That of under-supply for the last 30 years) will prevent a house price decline such as that experienced elsewhere in the world. Imagine that - people grateful the UK hasnt been building houses! (I was an FTB until 3 years ago so I understand the frustration but obviously now have a different POV!)

PS. I notice a lot of people complain about "my money as a taxpayer being wasted" when it comes to NR - but I am pretty sure the taxpayer (Which includes me) has a higher chance of getting its money back through NR - with interest - than the same taxpayer money wasted in other areas...

Sorry long post...

  • 35.
  • At 05:06 PM on 31 Mar 2008,
  • Jim wrote:

It seems it`s only big business managers that get large payoffs when they leave ( that are built into their contracts ) whether the business floats or sinks .

  • 36.
  • At 06:08 PM on 31 Mar 2008,
  • Stephen Butler wrote:

As I understand it, the Bank of England loans to NR are at what the BoE considers a "punative interest rate?"

If these loans are paid back by the end of 2010, how much would the BoE expect to make on these loans? Also how much extra would the "punative interest" amount to over their more usual interest rate?

Isn't that what the taxpayer stands to make on the Bank's intervention in Northern Rock? (That and the presumed windfall when NR is floated back into private ownership.)

  • 37.
  • At 06:08 PM on 31 Mar 2008,
  • William wrote:

Would everyone please note that a householder who borrows money grants a mortgage and is therefore a mortgagor, the bank/building society is the mortgagee.

  • 38.
  • At 06:17 PM on 31 Mar 2008,
  • Steve B wrote:

The NR company report is pretty much what you'd expect; new management blaming the old, increasing of provisions, setting of soft profit goals, etc.

  • 39.
  • At 06:23 PM on 31 Mar 2008,
  • phil wrote:

Good points in posts 1 and 2 (Dee and Tim Rossiter).

Also, what is the value of the 'pledge' to repay the 24 billion? How is it going to be achieved? If all the prime mortgages move and only near and sub prime are left (as Dee rightly suggests) then other creditors will want to withdraw their loans to NR. Our 24 billion will be the last to be repaid.

In sum, I think the pledge is worthless, just a political gesture, timed for after the next election

  • 40.
  • At 07:52 PM on 31 Mar 2008,
  • Steve Frost wrote:

What a comment on the state of the UK!

Network Rail over-runs on engineering work, arrangements are made to divert passengers with considerable inconvenience, but nobody sleeps on the stations and nobody's luggage is lost. Result: £14M fine

British Airways mess up big time at Terminal 5. People's flights are cancelled with no alternative offered, 28000 bags are thrown into a heap. People miss flights, have to sort out their own accommodation or sleep in the terminal. So far its gone on for 5 days. Result: They're sorry. Is there any mechanism to fine them?

Adam Applegarth supervises a business plan that causes the first run on a bank in 100 years, savers lose confidence, shareholders seem to be about to lose their money and 2000 people are to lose their jobs. The Bank of England is owed £25Bn. Result: Payment of £760000 to him.

He should have the decency not to accept it, contractual rights or not. Which is most important?

  • 41.
  • At 08:52 PM on 31 Mar 2008,
  • Ted wrote:

Re Jim #35... I think the sentiment is widely echoed.

There was a commentator on the radio who produced a decent stab at why this happens... basically the idea was that everyone on Remuneration committees gets so carried away,at contract time, by the thought of success...so much so that all thoughts and eyes become averted from the possible consequences of failure however catastrophic.

The commentator also explained why companies are always reluctant to tell any failed exec to "go ahead and sue if you want the money" (for fear of scaring off any other replacement for the post.)

However there may be a solution to this that doesn't involve the UN or the International Court at the Hague or the EU.

Is it not possible to make this into a TV show...?

Executives from ten businesses where shareholder value has been most efefctively destroyed get to tell their tale of business woe and make their excuses as to why it wasn't their fault but was "global factors", "credit crunch" or just bad luck and so forth?

A panel of ordinary people then decide and the exec with the lowest number of votes is told by the spokesman "You're fired ...and no, you can't keep all the the compo!!".

The panel then ponder what amount of compo is to be handed over before announcing it.

This goes on each week until there is only one exec left.... the winner getting the chance to work in a proper job, alongside someone who actually knows what they are doing to see if they can make a go it.

It could be called "Shareholders Den" or something...and the money left over, after paying the "Shareholders Den" amounts, from the previously alloted payoffs can be distributed to charity.

I have to say I can see at least one massive and potentially costly flaw...Sippose the Shareholders Den panel were to award HIGHER amounts than the executives had already been given in payoffs----- But is that realistically going to happen?

And--- it is just a "potential" flaw..it MAY never happen---- and probably won't.

So why bin a decent business idea and money raising model for something that's 'never' going to happen (and if it does we can just say we never thought of it anyway)----why not just run with it?

Though I guess this IS where we came in, really!

  • 42.
  • At 09:22 PM on 31 Mar 2008,
  • chris wrote:

Echo post 34.

I complained to the FSA (Ha!) that the Government was now, in fact, in breach of [although strangely inverted] anti-competition rules and interest rate price fixing. The Treasury (in other words the Government) is setting central rates on a political basis and that same Government is setting the NR commercial rate at way above the market rate. Who pays? The borrower like me. I am now in effect paying an additional tax to repay myself (the taxpayer) sooner. By 2010.

Don't get me wrong, I appreciate a lender can set whatever rate they like, and if they price themselves out of the market then that's their business. But these ain't normal market conditions. If NR had gone to the wall, there's every likelihood I'd have been on the same mortgage deal, just with another lender. That all a borrower can ask for. We can't all move our mortgages and I can't due to change in circumstances.

The central rate has fallen 50 base points recently and another 25/50 is likely. NR has passed on just 20 base points reduction, whereas the majority of other lenders have passed on most if not all 50.

The FSA said in their reply:

"The FSA has no remit or power to hold the Government accountable for its actions".

So despite the Government running a bank it is not accountable to the FSA.

Isn't it comforting that, after Iraq, Afganistan, WMD, sleaze, MP expenses...... we find that the Government can do what the hell it likes while running a bank completely unregulated.

  • 43.
  • At 09:39 PM on 31 Mar 2008,
  • John K wrote:

Robert

Surely you know the difference between nationalisation and privatisation?

If not, you need to start looking for another career...

  • 44.
  • At 05:16 AM on 01 Apr 2008,
  • zo bolchim wrote:

As exemplified by Jack Welch for General Electric, business leaders can multiply the value of companies hundredfold.Hence huge salary to attract the best of the best.

And they are at times, highly empowered to be 'creative'.Applegarth strategy was contingent on continue liquidity in the market..then sub-prime mortgage happened.

As a PAID EMPLOYEE, there will always be a limit ( his salary) to his gain even on a upside. And equally so,there is gonna be a limit on his loss in a downside.

Share of risk correlates to his share of profit.Really, who would have benefitted if the sub-prime had not happened ( hint : S....H.....)

But, i fear his mistake will also be the 'end' of his proffessional career.

  • 45.
  • At 06:25 AM on 01 Apr 2008,
  • Ca Ira wrote:

Robert,

Mr Sandlers recovery plan would have been condemned by the labour party as 'capitalist asset stripping' and the CEs payoff as 'the evils of capitalism' a few years ago.

I guess the left wing labour MPs are gagged to comment about the Northern Rock situation.

  • 46.
  • At 10:05 AM on 01 Apr 2008,
  • DaveH wrote:

Ah yes, there they are - all so terribly experienced in the City and now running around like headless chickens trying to avoid responsibility for their failures.

"We are concerned that the chief executive was not a qualified banker, although of course he had significant experience. The FSA should not have allowed nor ever again should allow, the two appointments of a chairman and chief executive to a 'high impact' financial institution where both candidates lack relevant financial qualifications"

The Uk Parliament Treasury Select Committee report on Northern Rock.

Or in brief:

"If experience really mattered, Man would never have walked on the Moon" (Doug Rader, a US baseball player).

Has anyone picked up on Adam Applegarths £304,000 annual pension due at age 55 ?

No need to do any more work by the looks of things (which is good news for the UK economy !)

  • 48.
  • At 01:12 PM on 01 Apr 2008,
  • graham firth wrote:

I am suprised that Adam Applegarth
is receiving a payoff of that magnitude albeit less than his contractual entitlement.
In similar circumstances, the notice period in the contracts of all our execs were reduced from one year to 3 months as part of the terms for an investor to provide funding for the business to continue. The BOE has obviously not pressed aggressively enough as would have been done by the private sector in these distressed circumstances.

  • 49.
  • At 09:09 PM on 01 Apr 2008,
  • Dorte wrote:

What seems to have escaped everyone's attention in this 'bash Applegarth' hysteria- is that the year after he became CEO NR had 2,500 staff (see annual accounts 2002). So it seems as if his expansionist approach created 4000 jobs over the years, 2000 of which sady look likely to be lost, but that still leaves a net gain of 2000 jobs that may never have existed under an alternative 'Steady Eddy' policy. Do you really think it would have been better that they never existed at all, than for some to be lost now?

p.s. this is not trying to downplay how tragic any job losses will inevitably be for those involved.

  • 50.
  • At 12:29 PM on 02 Apr 2008,
  • Joseph Gibson wrote:


In about 20-30 years when our government and people have changed this will go down as one of the biggest or the largest government scandal in history.

This post is closed to new comments.

BBC © 2014 The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.