There's a new campaign being led by Labour MP Chuka Umunna to remutualise Northern Rock, with a letter supporting the proposal published in the Guardian and an EDM tabled in Parliament.
The proposal has cross-party support with two Conservative MPs co-signing the Guardian letter, along with a Liberal Democrat and even Unite General Secretary Len McCluskey.
As I argued in October 2008, there should be "a return for the public" for the huge loan bailout and subsequent nationalisation of Northern Rock.
I have to say I'm currently only lukewarm about the campaign. I'm instinctively sympathetic - my savings and current account are both with a mutual - but I'm just not clear on how re-mutualising Northern Rock would work, and if it would be fair to taxpayers who after all are the ones responsible for its continued existence.
Sadly, neither the letter, EDM nor campaign page answer these concerns - it just tells me mutuals are more accountable, democratic, and that it would be popular, none of which I would dispute.
The questions I have for the campaign are therefore:
- What is the benefit for the taxpayer? The taxpayer collectively saved Northern Rock so why should only current customers benefit?
- Which bits of Northern Rock are we talking about - it was split into good and bad over a year ago, and with differing results - and will the taxpayer be again left with the bad bit? Gerry Gold raised this here on LEAP blog
- Why not just keep Northern Rock in public ownership and use future profits to fund public services?
- Shouldn't former employees benefit too? Over 2000 have lost their jobs since 2008 - yet it was their taxes that paid to 'save' it as much as anyone else's. And would this be a building society model or would staff have a governance role too? If so, what?
- Also, what about a benefit for all those whose homes were repossessed early by the lender as it aggressively tried to repay the government loans it received?