Northern Rock - North East jobs must not be sold out

10.15.00am GMT Wed 28th Oct 2009

Lib Dem Parliamentary Spokesman for Newcastle East Greg Stone has reacted to speculation over a possible sell-off of Northern Rock by the Government by warning that any deal which does not protect jobs at its Newcastle HQ would be an "unforgivable betrayal".

There is increasing speculation that a deal may be imminent after the Government sought permission for a deal from the EU, with either a commercial deal or a "remutualisation" - turning Northern Rock back into a mutual building society - thought to be possible.

Greg Stone said "Northern Rock is still a major part of the economy of Tyneside and it is of paramount importance that any new deal safeguards the jobs of remaining workers. Selling the bank off to another company would be attractive to the Government in terms of reducing the national debt, but there are fears this may lead to job cuts as the new owner rationalises Northern Rock's operations with its own. This would be an unforgivable betrayal for the North East."

"I recently had the opportunity to discuss the remutualisation option with Lib Dem Shadow Chancellor Vince Cable. It is in many respects more attractive as it would help to re-establish more sustainable mutual values in the financial services sector, and would be well supported in the region. However the Government may not wish to pursue this route because it would mean it would not be able to recover all the money it committed when the bank was nationalised.