PMQs: Nick tackles Gordon on Northern Rock and energy prices

by Stephen Tall on February 20, 2008

After last week’s half-term break, there were few surprises at today’s Prime Minister’s Questions: the Lib Dems’ Nick Clegg was able confidently to lead with Labour’s mishandling of the Northern Rock collapse (thanks to Vince Cable’s far-sighted statements), while Tory leader David Cameron (who, with George Osbourne, has been all over the place on the issue) avoided mentioning it in his first round of questions.

Nick followed up – after a pointed dig at the Tories’ “economic illiteracy” – with a ‘bread and butter’ question on energy prices, something which is fast becoming his trademark.

Here’s the Hansard transcript of their exchange:

Mr. Nick Clegg (Sheffield, Hallam) (LD): This being the Prime Minister’s birthday, I welcome his 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?

The Prime Minister:
I thank the right hon. Gentleman and the Leader of the Opposition for their best wishes on my birthday. I also 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.

Mr. 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?

The Prime Minister: 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 winter 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.