Parly approves bank nationalisation

LONDON – The nationalisation of Northern Rock is expected to be finalised on Friday after British lawmakers passed emergency legislation allowing troubled banks to be taken into public ownership.

A bill was accepted late on Thursday after a brief tussle between the upper and lower houses of parliament, clearing the way for the first official British nationalisation since the 1970s. The government must now obtain an order which specifically transfers the bank to public ownership, powers which were awarded by the bill.An order which deals with compensation to the bank’s shareholders will then follow.Finance minister Alistair Darling maintains that public ownership is only temporary but has pointedly avoided the word “nationalisation”, which still has negative associations with Britain’s economic woes in the 1970s.Darling has faced calls to quit over the affair.The main opposition Conservative party argue he took too long to make a decision, after rejecting bids from Richard Branson’s Virgin Group and Northern Rock’s own management.But late on Thursday a top union leader accused both the governing Labour Party and the main opposition Conservative Party of “scoring points off each other” when the real issue was about jobs and livelihoods.”This should not be an issue about party politics,” the general-secretary of the Unite union, Derek Simpson, said in a BBC television debate on Northern Rock in the bank’s home base of Newcastle, north-east England.Northern Rock was forced to apply for emergency central bank loans in September last year after being hit by the downturn in the US subprime mortgage sector.It has since borrowed an estimated 26 billion pounds, although media reports have put the actual liability to taxpayers at 55 billion pounds or higher.Nationalisation plans were announced on Sunday and legislation was first laid before parliament Tuesday.Lawmakers in the lower House of Commons approved it within hours.But it ran into trouble in the unelected upper House of Lords.It was voted down and sent back to the Commons with three attached amendments earlier on Thursday, but all three were shot down by the Commons, which traditionally has more power.-Nampa-AFPThe government must now obtain an order which specifically transfers the bank to public ownership, powers which were awarded by the bill.An order which deals with compensation to the bank’s shareholders will then follow.Finance minister Alistair Darling maintains that public ownership is only temporary but has pointedly avoided the word “nationalisation”, which still has negative associations with Britain’s economic woes in the 1970s.Darling has faced calls to quit over the affair.The main opposition Conservative party argue he took too long to make a decision, after rejecting bids from Richard Branson’s Virgin Group and Northern Rock’s own management.But late on Thursday a top union leader accused both the governing Labour Party and the main opposition Conservative Party of “scoring points off each other” when the real issue was about jobs and livelihoods.”This should not be an issue about party politics,” the general-secretary of the Unite union, Derek Simpson, said in a BBC television debate on Northern Rock in the bank’s home base of Newcastle, north-east England.Northern Rock was forced to apply for emergency central bank loans in September last year after being hit by the downturn in the US subprime mortgage sector.It has since borrowed an estimated 26 billion pounds, although media reports have put the actual liability to taxpayers at 55 billion pounds or higher.Nationalisation plans were announced on Sunday and legislation was first laid before parliament Tuesday.Lawmakers in the lower House of Commons approved it within hours.But it ran into trouble in the unelected upper House of Lords.It was voted down and sent back to the Commons with three attached amendments earlier on Thursday, but all three were shot down by the Commons, which traditionally has more power.-Nampa-AFP