Live blog: Cameron-Osborne press conference

David Cameron and George Osborne are about to speak at an emergency press conference on Northern Rock...

(Highlights - not verbatim):

Cameron: Northern Rock is a disaster for the Government, the country and the taxpayer.

The taxpayer now has responsibility for a mortgage book during a period of significant uncertainty for the housing market.

This ends a disastrous period for the Chancellor - he copied Tory inheritance tax plans, lost the data of 25 million people and has had to u-turn on the taxation of non-doms and CGT. But those errors pale into insignificance compared to this.

This is the biggest nationalisation ever.

Osborne: There are serious issues of unfair competition here with Northern Rock able to offer higher savings rates than other retail banks - all guaranteed by the taxpayer.

Cameron: Even before the run there were errors of financial regulation.  Decisions were also put off on Northern Rock because of dithering over the General Election.

Osborne: Government must publish advice that Goldman Sachs gave to Government.

Cameron: One of the lessons of the ERM episode was that there is no use in sticking with a Chancellor who has lost the nation's confidence.  There is no point waiting any longer.  The Prime Minister must fire his Chancellor and reconstruct his Government.

Osborne: We will vote against nationalisation but will not use every procedural parliamentary device to obstruct it.

Osborne: Labour are not proposing a simple bill to nationalise Northern Rock but to take on powers that will allow ministers to nationalise any financial institution into public ownership at any time in the next year by ministerial dictat.

Osborne: The difference between the Tory and Labour approach is £55bn of extra liabilities for the taxpayer.

Download a PDF setting out the full Conservative position on Northern Rock.

Comments

[Malcolm Dunn]

Haven't been able to watch this so have only your precis. Osborne's last two comments are interesting.If we oppose nationalisation (I personally can't see any other alternative sadly)why are we not doing everything to prevent it?
His last point is very worrying. Surely even someone as foolish as this Chancellor should realise by now that if the Govenor of the Bank Of England cannot organize a takeover of a stricken institution it should be put into administration.

[TFA Tory]

I agree with Malcolm and ask that someone gives him smelling salts.

[Stefan Stern]

If the comments are being reported accurately, it seems a tad ungenerous for Mr Cameron to dance on Norman Lamont's political grave in this way - "One of the lessons of the ERM episode was that there is no use in sticking with a Chancellor who has lost the nation's confidence." Wasn't Mr Cameron working for Lord Lamont (as he then wasn't) at that time? The former chancellor was "singing in his bath" after Sep 16 1992, was he not? He took the flak manfully at the time, and was a convenient lightning conductor for John Major.
I wonder how encouraged shadow cabinet members will be by this sort fo remark.

[David]

"why are we not doing everything to prevent it?"

From a political stand point, blocking tactics, when the Government and the LibDems are going to get it through anyway, make it easier for the opposition to be smeared with accusations of playing politics with the economy. The Conservative opposition will be noted, and that will be enough.

From an economic standpoint, I suspect that it's probably better off to have the policy go straight through rather than delay it and cause further uncertainty.

[TFA Tory]

I echo the excellent comment by Mr Stern. Cameron's comment on the ERM, i.e. an attack on his former boss Norman Lamont, was nasty, disloyal and unnecessary. It was Major's, rather than Lamont's, to enter the ERM. Lamont was the fall guy for Major and Hurd, Dave's predecessor in Witney who was a key player in the ERM debacle.

[michael mcgough]

Osborne's half-hearted opposition to nationalisation doesn't bode well for Tory (in)action post ratification of the Lisbon Treaty does it.

I suppose accepting the extra £55 billion of liabilities is akin to adopting all of Labour's speding plans.Against nationalisation but not opposing it----------Who's the DITHERER NOW GIDEON?

Opposition party,NOT.

[Adam-]

George Osborne performed poorly in Parliament today. His mauling of Darling seemed childish, opportunistic and lightweight, and it ultimately failed. Vince Cable performed much better.

[john]

Adam I don't agree - Osborne has to make the most of this opportunity to hit Darling and Brown as hard as he can, and that's exactly what he did. If the Conservatives weren't opposing this and calling nationalisation a monumental failure then the Government would just get away with it. As it is voters have been shown the full extent of Labour's incompetence.

[Umbrella man]

Brown kept smiling during Darling's Commons statement.
What a silly man we have as PM.

[TFA Tory]

"Osborne's half-hearted opposition to nationalisation". It is not opposition. As "Karen" posted yesterday, George Osborne proposed the renationalisation of the railways when he was an adviser to William Hague. I have heard that story told by three people who held senior positions in the party at the time. Apparently, Osborne said that the policy would have traction (sic) with the voters.

This is the man, who is, according to Sean Fear, a brilliant strategist, the Conservative's Karl Rove. Well, he does have Rove's unprincipled and cynical expediency.

[Clockwork Mouse]

Didn't the Conservatives nationalise Rolls Royce?

[Scotty]

Adam, it was Alastair Darling who came to Parliament today to announce the nationalisation of a Bank after months of dithering which now leaves the Treasury and therefore us poor taxpayers even more exposed.
The sheer level of incompetence displayed by this government goes way beyond a poor performance in Parliament. They are the politicians who have had a whole department of civil servants pouring over the wreckage of NR, plus outside experts drafted in at god knows what cost, more importantly they the books of this failed bank in their grubby hands.
Like many other voters, I don't have a mortgage, savings or loans with NR but my taxes will be propping up this disaster for years to come. How can NR carry on opening its doors to new buisness in this situation and won't it cause serious concerns amongst the other banks?

[Gnosis]

I agree whole heartedly with Mr Stern.

[TFA Tory]

"Brown kept smiling during Darling's Commons statement. What a silly man we have as PM." Brown is the sub-Prime Minister!

Unfortunately, we have a Shadow Chancellor who is out of his depth on serious financial and economic issues.

[Scotty]

"Unfortunately, we have a Shadow Chancellor who is out of his depth on serious financial and economic issues."

What a pathetic comment.

[Gnosis]

[email protected]:10..you sound like your one of those "MODERN" very cynical politally motived chaps but that is exactly what the voters DON'T want,attack at any cost sir is called opportunism and thats the one thing that all voters of whatever leaning totally detest more that anything.

[voice of the city]

Not an issue to play party politics with. Timne for Osbourne to grow up.

The taxpayer had already signed up for all the downside, it is right that they will now benefit from any upside.

PS - as the cost is likely to be near zero in terms of any payment for shareholders, it is inaccurate to describe it as the biggest nationalisation ever. That was, and remains, the NHS.

[Iain]

"Osborne has to make the most of this opportunity to hit Darling and Brown as hard as he can, and that's exactly what he did"

If only, the trouble has been the incoherent and muddled Conservative position on NR. It would have been much better if the Conservatives had established a clear position and argued from that case, it's pretty awful hearing commentators saying they have been unable to establish what the Conservative position is or was, and when George Osborne stands up in the Commons it does nothing to advance the Conservative case when he isn't able to highlight the cost of the Government nationalising NR against what they would have done, and when people are looking for a reasoned case from the opposition, all they get is the personalised attack. Someone should take George Osborne aside and point out that sometimes less is more, and this NR situation is such a magnitude that to launch a personal attack actually devalues the case against the Government.

[Martin Coxall]

Northern Rock should have been allowed to fail.

Once we start sending messages to the private sector that we're prepared to prop them up not matter how recklessly they behave, the game is up.

Brown has set a dangerous precedent, and the entire nation will reap what he's sown.

[voice of the city]

Martin - you clearly don't understand that finaicla markets rely on confidence.

Allowing the 5th biggest bank in the Uk to fail would be an interesting experiment, but not one any sensible or informed regulaotr woudl wish to see as the posibility of wider contageion and a collapse of the banking sector (think great depression)

[Ellesmere Dragge]

So, we have arrived at a position. Back in November we were in favour of nationalisation. We now believe Northern Rock should be handed over to the Bank of England (prop: UK plc) and run down. But we are no longer in favour of nationalisation. Well, perhaps that needs a little bit more greasing if it's going to run.

Or was this strategy derived from the Grand Old Duke of York?

Then the "dead man walking" nonsense was pathetic: it sounded derivative and feeble. As others are pointing out, what's wrong with putting up a Vote of No Confidence? If we had a case, it was time for Etonians to summon up the blood and announce they were tabled just that motion. Surely, it's put-up or shut-up time.

Sadly, on his performance today, Osborne fumbled it badly. How open does a goal have to be?

[Alan S]

Mervyn King's memoirs will make for a fascinating read in ten/ twenty years...

[Malcolm Dunn]

I think it's you who doesn't understand the financial markets 'voice from the city' Northern Rock's business model was unlike any other.Had NR been allowed to go bust or more likely put into administration there is absolutely no evidence that any there wouldhave been a collapse in the Banking sector. The problems in the US which are more serious have not resulted in any bank failures or indeed a 'great depression'.

[Martin Coxall]

@Voice of the City:

I work for an investment bank, and I understand the city only too well.

Northern Rock was acting recklessly and ridiculously. We've now sent a message to banks that says "Go on! Do the same! We'll bail you out no matter how incompetent!"

Don't think the city won't take encouragement like that to heart. We've given banks confidence to engage in more reckless behaviour that will deeper the forthcoming sub-prime crisis.

We should have sent a message to other banks to get their house in order or die. Instead we've given them a green light to carry on regardless. Great.

We will all suffer for this. Painfully.

[TFA Tory]

Scotty should note that Iain shares my dim assessment of Osborne. Osborne has only offered schoolboy jibes rather than present a serious alternative policy.

Voice In The City makes a fair comment. The problem is that the shareholders, whilst happy to have the Treasury's guarantee, were unwilling to accept Virgin's offer. Nationalisation is very risky and possibly illegal for the reasons that I have stated earlier. It cannot be long before the credit agency's downgrade the UK's rating.

It would have been fair if BR's shareholders' had allowed their shareholdings to be diluted by the Government taking a minority stake in exchange for the Treasury guarantee. The Government could then sell the minority stake after the new management restructured or refinanced the debt.

[TFA Tory]

Sorry for the typo, I meant NR's shareholders at 16.58.

[voice of the city]

Martin/Malcolm

I suggest you go back and look at the share prices of other UK banks with <50% of assets secured through retail deposits last August before concluding that there was no risk of systematic failure. A&L, B&B< HBOS and a raft of specialist lenders all showed signs on investor flight, and the LIBOR premium was pricing in a material risk of default.

Again to correct you, there have been dozens of US bank failures over the past 6 months - but fortunately of relatively small lenders - the largest being countrywide. And depositors are better protected by the FDIC which does not lock up retail deposits as is the case in the UK.

No regulator would let a major commercial bank fail - the effect on the wider economy would be catastrophic as every financial institution was boycotted for fear of counter party exposure and a massive monetary contraction resulted.

If you work in a bank then I suspect you are not senior enough to have lived through enough cycles, or witnesses bank failures such as the soviet 98 collapse. It is not pretty, and not worth risking for some doctrinal free market absolutism.

At any time other lenders could have stopped the NR model by pricing credit appropriatly - they didn't and the party came to an end. The repricing of financial sector risk from mortgages to Icelandic bank exposure and LBO debt will prevent another NR type model from succeeding, until the credit markets loose their institutional memory, in the meantime the first priority of the government must be stability of the system.

[Comstock]

I still don't see why Northern Rock can't be re-mutualised....

[TFA Tory]

" still don't see why Northern Rock can't be re-mutualised...."

Because it would not have a strong enough balance sheet to survive. Ideally, it needs to be taken over by a big bank with an excellent credit rating.

[Malcolm Dunn]

Yes there was investor flight from Bradford and Bingley and Alliance &Leicester in particular. There is no evidence that either bank would fail.
Some of the sub prime lenders may yet fail. Is that a bad thing? Irresponsible lending needs to have a price.

[Scotty]

"Scotty should note that Iain shares my dim assessment of Osborne. Osborne has only offered schoolboy jibes rather than present a serious alternative policy."

I await with interest to see the details of Labour's nationalisation plans. Osborne's job at the moment is to make sure that this government does not rush through yet another badly planned bill which ends up costing us dearly. At the moment the Libdems are patting themselves on the back because they advocated nationalisation before Labour were forced into it. Osborne and the Conservatives are asking the right difficult questions of the Labour plan.

Rather than make a fair comment, voice of the city simply tries to peddle the governments spin on this disaster.

[Andrew Lilico]

voice of the [email protected]:11

Few would dispute that avoiding financial market panic and bank contagion are desirable, but the question is what is the right way to do this. Compare and contrast the following two options:

a) Either lend cash, if an institution is solvent and lending cash will work; or organising a swift takeover; or force a liquidation. Have no explicit rule and no explicit deposit insurance, but have a powerful institution in charge of making everything work smoothly. This is the "Bank of England as king" model of financial-market-stabilisation regulation that operated in the UK from the 1860s to 1998.

b) Do not have a king, but instead have a mix of institutions, "transparent" rules, deposit insurance, nationalisation, and other measures to keep things afloat. This is the model favoured by just about everyone other than the UK during the 20th century. It was the system introduced, partly by design in 1998, partly through events in 2007.

Which system do you think works better for the UK?

[voice of the city]

Yes there was investor flight from Bradford and Bingley and Alliance &Leicester in particular. There is no evidence that either bank would fail.

All major banks run a mismatch between short term liabilities (eg deposits) and longer term assets (loans). There is a duration mismatch which is always present.

That is why runs on a bank are catastrophic - and they are driven by confidence. A bank can be solvent with excess tier 1 capital, but still fail because it doesn't have liquidity - access to immediate funds.

And scotty - I am a thatcherite with decades of support for the Tory party. please don't insult me as some labour spin pedaling troll - if you don't think my comment is fair please explain why. As i sit on the board of a small bank I actually have strong opinions about this stuff.

[voice of the city]

"Some of the sub prime lenders may yet fail. Is that a bad thing? Irresponsible lending needs to have a price."

Totaly agree. Caveat being that if you are big enough it is too risky to allow failiure.

[voice of the city]

Andrew - the first worked better but risks legal challenge from eg EU human rights legislation (for which a public interes carve out is bady needed).

On a point of detail, pre 1998 there was desposit insurance

[TFA Tory]

This fiasco should kill off the fanciful notion that the Bank of England is independent. It acts within the framework set by the Treasury. Interest rates and the inflation indices did not reflect rampant house price inflation and we have paid a heavy price for the Bank's lack of courage in standing up to the Treasury. The Governor should resign immediately.

[ACT]

It's good to hear for once someone talking about this - the Voice up there - who actually understands the City. Obviously we don't *need* doctors at Health, bus drivers at Transport, farmers at whatever MAFF is called these days, or even colonels at Defence, but couldn't the Tory Party of all parties find somewhere someone slightly more clued in than Osborne? Gauche hardly does justice to his turn this afternoon.

Of course the lunatic 'Dave (& George) can't do any wrong' crowd [take a bow Scotty] will doubtless sidle up along aside innocent CH posters in, oh, a fortnight's time, after Darling has easily clung to office thanks to Osborne's staggering uselessness, and assure us, "aha! it's all part of the Davite Georgo-Coulsonist brilliance of the party leadership you see! We *want* to keep the liability Darling in place . . ." Make easy money: keep your spread on Labour as the largest party after the next election. That's how bad Osborne and Dave truly are. The market has spoken.

[Andrew Lilico]

voice of the [email protected]:37

>On a point of detail, pre 1998 there was desposit insurance<

Well, if I recall correctly, the UK's deposit insurance scheme came in in 1979 - before then we had none at all (it came in because of the requirements of an EEC directive, I believe) - but it covered only the first £2000 of deposits, with 90% coverage for the next £33,000.

If you want to call that deposit insurance, you're welcome. It's pretty nugatory. And even that amount was a bad idea. Deposit insurance is a flawed and unnecessary concept, if you have a Bank-of-England-as-king model, which makes bank solvency problems worse, not better. In the Bank-of-England-as-king model, the issue of a solvent institution failing and leaving uncovered depositors never arises, so deposit insurance serves no function except to insure the depositors of insolvent institutions - precisely those you do not want to insure, since insuring them gives depositors an incentive to place funds with high-interest-paying insolvent or near-insolvent institutions, as was the case in the US Savings and Loan crisis.

[Andrew Lilico]

One aspect of this that I haven't seen discussed: The government now has a very significant incentive not to permit UK house prices to fall, even though arguably a fall of at 10-15% is positively desirable. This will colour its reaction to Bank of England decisions, housing market regulation, planning reform, and many other issues.

Is it really good for policymaking for the government to be conflicted in this way?

[voice of the city]

"If you want to call that deposit insurance, you're welcome."

I do, thank you for your correction.

[billy]

Come on Adam, TFA Tory - do you think that if the roles were reversed and NR had to be nationalised by the Tories in power, that Labour in opposition would adopt a calm, dignified approach, especially with someone like Blair at the helm?

No! They would keep biffing the Tories in the eye as they did with a whole host of issues in the 90s. Did Labour ever produce an alternative proposal to Government policy?

Biffing may not be strategic, but tactically it is effective - if is repeatedly used, then who's talking strategy?

And stop polishing Cable's laurels - he may have correctly sensed the inevitable outcome, but the merits of nationalisation with this governemnt's track record are dubious, and Cable is hyping it up. Plus, he works for another party.

[Drusilla]

Here's a constructive suggestion for you (no, really!) - why not make John Redwood our official shadow grand panjandrum for all things Northern Rock? He may be viewed as 'incredibly right wing' in some quarters, but in the City, he's at least widely believed to know his technical stuff - how in practice one securitises debt etc - whereas Dave, alas, is known mostly as a fluffy and failed PR girl [sic], and I cannot even think of a polite yet intelligible way in which to render what City folk say about Osborne.

[michael m]

Clearly the Press Conference was a waste of time as the main BBC 6 o' clock news made no mention of it in their lead on the Rock- indeed the entire item wsa devoted to what the Government wants us to believe- no oppostion comments at all allowed!

The only sense was from Robert Peston who is warning that mortgages will now go up- once people see this in reality, they will then believe what a disaster this nationalisation will be.

I hope the Party complains to the BBC about the complete lack of opposition comment this evening.

[TFA Tory]

Bashing the Government is simply not enough. With the nation's finances at risk, this is one occasion when the Opposition must a sensible and coherent alternative policy. Osborne has not delivered it and his track record suggests that he lacks the necessary skills and experience. Working for CCHQ does not qualify him to run the country's finances. The Party and the country deserves and needs a heavyweight Shadow Chancellor.

[voice of the city]

Bashing the Government is simply not enough. With the nation's finances at risk, this is one occasion when the Opposition must a sensible and coherent alternative policy.

Well said.

And now for a constructive comment. Public sector pensions are largely unfunded, and the uk balance shhet is not stretched. The right home for a lot of long term assets is a pension fund - the government could transfer the mortgage book as a one off contribution to various public pension schemes who would be long terms holders, outsource servicing to another bank, transfer deposits to another bank, run down the NR operational side to save costs, and repay creditors when due through bond sales.

Avoids a fire sale, or need to operate the bank, and provides a mucch needed funding boost to underfunded public pension schemes. everyones a winner (except the government has more debt in the general ledger account rather than in the hiddend pension laibility column.

[Gnosis]

michael m @ 18:30 I actually glad the bbc hasn't covered our policies on NR as it all seems hopelessy muddled in the mind of Mr Osbourne and Mr Camerons snide dig at Norman lamont was very petty indeed,i felt rather ashamed of Mr Camerons opportuism today as it seemed rather childish and cowardly,Mr Lamont took the full rap and resposibility for the ERM meltdown for the then PM Mr Major unlike many mps and ministers toady.

[billy]

TFA Tory - bashing the government may not be enough, but it is progress compared to 2001 where we could not land a blow of any kind.

It would have been irresponsible of George Osborne not to say that Labour's reputation for economic competence was dead.

As to alternative policies, the danger with presenting them is that Labour will then turn it around to make it an issue about the Tories policies' in order to deflect from their problems. They have deployed this tactic successfully many times in the past and Brown continues to do so. Just look how he turns the questions on Cameron in PMQs.

Say what you want about Osborne - but remember, he single-handedly saved the Tories from decimation last October, yet you accuse him of lacking skills and experience. Why have you not said this about Darling or Brown?

Fact is, Cameron or Osborne will never get it right as far you are concerned. It appears that you want a leader who is effectively a member of the Tombstone (sorry, Cornerstone) group.

Dissension is good, but you are practically writing the script for Labour's next general election campaign, with your attacks against Osborne.

[Yet Another Anon]

The former chancellor was "singing in his bath" after Sep 16 1992, was he not? He took the flak manfully at the time, and was a convenient lightning conductor for John Major.
The whole singing in the bath thing just made him come over as flippant and detached from the everyday lives of most people. Subsequent public information films in which he was seen in the Bank of England's furnace room feeding old banknotes into the fires naturally brought to mind the large sums of money added to the National Debt as a result of propping up the pound in the ERM, Norman Lamont was always against the UK's membership of the ERM and should have had more backbone and once it was clear that keeping the pound at those rates in the ERM was not going to be possible without wrecking the economy he should have made it a condition of his remaining Chancellor of the Exchequer that the pound had to leave the ERM.

Nigel Lawson, Douglas Hurd and John Major railroaded Margaret Thatcher into agreeing to the pound going in and then Dougkas Hurd, Michael Hestletine, John Major and Kenneth Clarke kept it in for political purposes even long after it became clear that it was all going wrong.

[Michael Davidson]

Osborne was poor today as expected. He didn't get any decent jabs in, and to be honest I can't really see any practical alternative to temporary nationalisation at the moment.

To vote against the motion now just makes us look petty and prevents us getting the real attacks in.

Get rid of Osborne and replace him with Hague.

[Iain]

"Say what you want about Osborne - but remember, he single-handedly saved the Tories from decimation last October"

A situation George Osborne contributed to by failing to lay a glove on Gordon Brown as Chancellor, and letting him go to his coronation with the cry of’ best Chancellor ever’ ringing in his ears. The Times even gifted Osborne an opportunity to nail Brown over pensions, when they dug up evidence that Brown had been advised about the damage his tax policy would do to pensions, yet even that opportunity Osborne managed to squander in the debate they called on it in the House.

"It would have been irresponsible of George Osborne not to say that Labour's reputation for economic competence was dead."

Yes we all want to see that, its a question of how you go about it. The Chancellor's position puts someone in charge of all our financial well being, that requires someone with some gravitas who is able to command respect and has the argument to be able to carry his position, some shrill throw away personal jibe just doesn't do it.

[TFA Tory]

Billy, the problem is that there is no evidence that Osborne would be economically competent. I have heard him speak and answer questions on many occasions. His grasp of economics is undergraduate level at best.

[Michael Davidson]

I'm afraid I have to agree with TFA Tory. I don't know why the editors on this site seem to love Osborne so much - nobody else does.

He just got lucky at the party conference. But in the long run, he's doing our party more harm than good by staying in this position which is way above his abilities.

[Colin]

I thought Cameron, at his Press Conference, seemed highly strung-far too intent on seeking Darling's resignation-a bit worrying.

In Parliament Osborne failed to capitalise.
Trying to connect NR with the "economic competence" issue was wrong, a) because it stretches a point, b)because his own prefered option was not obviously different from Darling's-and c) because that horse is on it's last legs as evident from recent polls-it doesn't need flogging to death.

The best Tory contribution came from Ken Clarke-right on the nail with does "business as usual" mean selling new mortgages, and if so why? Will the mortgage book be liquidated?

Osborne failed completely in his mistaken urge to bash Darling-the open goal was there-How will the Company be managed to ensure repayment to the taxpayer in full?. This is a question to which there are no credible answers yet.

[Iain]

"This is a question to which there are no credible answers yet."

There is also the question about the EU, for from what Sandler said in his press conference, the Government has no clue what conditions the EU will apply to them running NR.

This to me seems a much more damaging question to put to the Government ( i.e. leaping into nationalising the bank without knowing the parameters within which they have to work) than calling him the dead man walking.

[Andrew Lilico]

I don't think there are really any significant unanswered questions left. Once you've nationalised, all questions go away, really. You've nationalised it. It's yours.

[Andrew Lilico]

Of course, it is true that nationalising may lead us into trouble with the EU. But not much. There are plenty of state-owned banks in other parts of the EU.

[Iain]

"it is true that nationalising may lead us into trouble with the EU."

But you might have thought the Government would have spent the last 5 months trying to find out what the conditions were, rather than doubling up our exposure to £110 billion and not having a clue.

[Billy]

"To vote against the motion now just makes us look petty and prevents us getting the real attacks in."

How will voting for the motion now allow us to get the real attacks in? What real attacks will we have if we support the measure?

Not only does it mean we support the Government's policy on nationalisation, but also that we will have done a U-turn on the fact that nationalisation is disastrous idea(with good precedent). If you think Osbourne was opportunistic today, reversing the position and backing nationalisation will make today look like an act of selflessness.

Nevermind the gesture. Let's look at the actual policy - if you have doubts about Osbourne, then look at what Redwood has to say about it on his blog. Then check out Anatole Kaletsky in the Times today.

In fact, I'm surprised more has not been made of the fact that NR will still be open for new business instead of being shut down.

You think Hague would make a better shadow chancellor - he may crack a few good jokes but look at his record. He did not win in 2001 and as a shadow foreign secretary, he has been hopeless. He could not hit Margaret Beckett (the easiest target) over the Iranian saga last year and he has not made any appearences when boy wonder Miliband is around.

You think Osbourne is inexperienced; but remember, Ken Clarke, no lightweight, had his reputation for the economy pinched by Brown when he stuck to his two year spending plans. Brown made it look like his own work and no Tory could touch him. If Clarke could not touch Brown, who else could? Osbourne has made mistakes, but he's made more progress than several Tory shadow chancellors when it comes to public perception.

[TFA Tory]

Osborne is advocating a that a Special Protective Administrator leads a Bank of England reconstruction. The Bank, backed with taxpayers' money, would run NR. The shareholders' rights are suspended and get what, if anything, is left. The big issue is what would happen if the Bank mismanaged NR. Presumably, the taxpayer would pick up the tab. In practice, this is not much different to nationalisation.

[TFA Tory]

Reluctantly, I agree with Billy that Hague would not make a good Shadow Chancellor. His performance as Shadow Foreign Secretary has been a huge disappointment. John Redwood's commentary on NR has been excellent and would be the best choice. Michael Fallon would be a close second.

[Billy]

Redwood defintely has the knowledge - granted. But one of the problems with politics is that it is not just about how skilled or how intelligent you are; you must be open and approachable, and media savvy.

Now I have no doubt TFA Tory that you will say that being media savvy is irrelevant when it comes to getting the job done. But it is still an important factor and does play into public perception. The importance of image cannot be underestimated, when it comes to people choosing their politicians.

Redwood and public perception: his attempt to hum along to the National Anthem, anyone? The Vulcan References? His questionable involvement in the Europe splits in the Major years? His blatant desire to cut public spending, with no couching of the language?

He is good - but would the Public be prepared to trust him as Chancellor with that baggage, particularly the public spending issue, which, if not handled well, is an election killer. An unsafe bet, I think.

Michael Fallon - not enough is known about him and we are only beginning to hear about him. Has not really made any media appearances and one cannot judge his media savvy. At the moment, it looks charisma free.

[Billy]

TFA Tory,

For the sake of the argument, let's take your proposition that Osborne's understanding is at Undergraduate level.

You do realize then, that by comparison, the current Labour managers of UK PLC, could not have collectively scored a grade E for Maths at Common Entrance?

[TFA Tory]

Indeed Billy. That's why I have been Conservative Party member for 30 years.

John Redwood has softened and become more media savvy in recent years. He even cracks jokes in private now. The public would warm to him if given the chance.

[Jake]

contrary to some of the opinions above this is tactically not a time to hold back from attacking the government . they are on the defensive . they are presiding over a massive foul up . the country knows it but is confused by the detail .
Therefore keep it simple . Core points only and make them easy to grasp hold of .

ie the national debt has just gone up by £100 billion

w'ell be lunmbered with this millstone for years

everyone has £3000 more debt today than yesterday

etc

[Bexie]

At some 23% of the possible electorate, this shower has hardly got a proper mandate for this behaviour.

It is a pity we cannot go after the plundered fortunes for the Blair Brown collective to get back some of the money they have lost us.

[James Maskell]

I caught a few btis of this Conference and again the question comes back, "Whats the point of these Conferences?" They are having a press conference on everything these days and very often there is little point in holding it. Weve had press conferences on expenses, societal breakdown and safety of children, this and the monthly press conference. These have all been recent. Perhaps the reason why they arent getting coverage is because they arent actually newsworthy?

The press conference yesterday was pointless in light of the fact that Osborne was to speak in Parliament yesterday. He needed to keep his powder dry instead of blowing it. His Parliamentary statement seemed rather condescending and his lines heavily rehearsed (ensuring that the flow is right is one thing, but you know youve gone too far when you do public speaking in the fashion he did it yesterday in the Commons). Calling for Darlings resignation is a silly move and he now cant save that bullet for a better moment ie. when the economy does take a downturn. His voice still lacks authority.

Thumbs down from me.

[Iain]

"Michael Fallon - not enough is known about him and we are only beginning to hear about him. Has not really made any media appearances and one cannot judge his media savvy."

Fallon was interviewed on the Dispatches program last night and came across really well making the telling arguments the Shadow Treasury team should have been making but have failed to with their muddled views and shrill jibes. One point which was very telling was that Fallon revealed the Government was warned about the impending collapse of NR a month before it did, yet they did nothing. Now that's the damming bits of information the Conservatives should be highlighting but aren't.

[Joe James Broughton]

Osborne needs to go - to be honest I can't see him handling a similar crisis any better - probably worse.

He's never run a decent size business.

I really fear this petty criticism of the government without offering any alternative policy will just look so obviously political and irresponsible.

We need Michael Fallon or Dominic Grieve in his place - possibly Phillip Hammond.

Yes the Labour government dithered and the system for spotting this problem hasn't worked as it should, but I have really been struggling to work out what our line is on this.

I think the two options, within EU rules, were actually to let it go, or to do what the government has done actually, and inside the newspapers (despite what they say on the front) most agree.

Taxi for Osborne.