Government spurns remutualisation

Secretary of State for Business Vince Cable has announced that the coalition government would be seeking to sell Northern Rock to the market. This is of course an about face to where Vince and his Lib Dem team were when they were writing their manifesto.

Michael Stephenson, General Secretary of the Co-operative Party, who are running a "The feeling is mutual" campaign, said :

"The ConDem Coalition has failed its first big test on co-operatives after less than 3 months.  By reneging on their commitment to re-mutualise Northern Rock, Vince Cable has shown that their devotion to a new approach to the economy is just a sham.

"Just like David Cameron's Big Society, this is a Big Con.  They are dumping all of their promises one by one and showing that they are just like the last Conservative Government which de-mutualised all of our building societies."

Jim Pickard's blog in the Financial Times criticises re-mutualisation.
http://blogs.ft.com/westminster/2010/08/the-case-against-turning-northern-rock-into-a-mutual/

Robin Ashby has said on a number of occasions in the media that if shareholders do not receive proper compensation (which Governments have refused to do) then the next best option is to give us our shares back. Although we would be heavily diluted as a result of the new shares that the Government has created for itself, we would still have some ownership and value, which are important to NRSSG members. he has however also pointed out that a number of members had been against demutualisation in the first place, so if Northern Rock was turned back into a building society they would consider honour was satisfied even though they had been deprived of value.