Chamber
Plenary, 01 Apr 2009
01 Apr 2009 · S3 · Plenary
Item of business
Dunfermline Building Society
I was not claiming Robert Peston as my financial adviser; I was merely saying that he is usually informed before the event of any announcements—so it appeared on Monday morning. I suspect that his calculation of the £10 million potential liability was made up not by him, but by whoever briefed him from his usual sources—let us put it that way.
I listened to the House of Commons debate on Monday afternoon and I thought that Willie Rennie, the local member of Parliament for Dunfermline, put forward the correct case. He acknowledged the willingness of a range of institutions to help the Dunfermline Building Society, including other building societies and the Scottish Government. He also asked whether more could not have been done to protect the society's independence. I thought that he asked the right questions and I hoped that the Liberal Democrats might ask those questions today.
As far as the social housing book is concerned, I am not certain that the member understands. I suspect that the auction on the social housing book is about how big a discount various institutions are looking for to take on the book, which is rock solid in terms of safety, but is low-margin business. The Scottish Government's interest in that aspect—which is, incidentally, shared by the Chancellor of the Exchequer, as he told me at our meeting; he has an equal concern about it—is to protect the availability of finance at the current rates that the Dunfermline Building Society was offering to RSLs across Scotland. Obviously, we hoped to make an investment contingent on the social housing book. I think that that would have been a valuable thing to do, if it could have protected the society's independence.
We continue to engage with the Treasury, at its invitation, on how we can obtain those objectives on social housing. The member has my assurance that the Government has that very much in mind.
I listened to the House of Commons debate on Monday afternoon and I thought that Willie Rennie, the local member of Parliament for Dunfermline, put forward the correct case. He acknowledged the willingness of a range of institutions to help the Dunfermline Building Society, including other building societies and the Scottish Government. He also asked whether more could not have been done to protect the society's independence. I thought that he asked the right questions and I hoped that the Liberal Democrats might ask those questions today.
As far as the social housing book is concerned, I am not certain that the member understands. I suspect that the auction on the social housing book is about how big a discount various institutions are looking for to take on the book, which is rock solid in terms of safety, but is low-margin business. The Scottish Government's interest in that aspect—which is, incidentally, shared by the Chancellor of the Exchequer, as he told me at our meeting; he has an equal concern about it—is to protect the availability of finance at the current rates that the Dunfermline Building Society was offering to RSLs across Scotland. Obviously, we hoped to make an investment contingent on the social housing book. I think that that would have been a valuable thing to do, if it could have protected the society's independence.
We continue to engage with the Treasury, at its invitation, on how we can obtain those objectives on social housing. The member has my assurance that the Government has that very much in mind.
In the same item of business
The Presiding Officer (Alex Fergusson):
NPA
The next item of business is a statement by the First Minister on the Dunfermline Building Society. The First Minister will take questions at the end of his ...
The First Minister (Alex Salmond):
SNP
Thank you, Presiding Officer, for the opportunity to make a statement to Parliament on the Dunfermline Building Society.Everyone in the chamber will have fol...
Iain Gray (East Lothian) (Lab):
Lab
I thank the First Minister for allowing early sight of his statement.This afternoon it is surely most important to welcome the fact that the assets of the cu...
The First Minister:
SNP
I am not sure that Iain Gray fully understands the nature of the payment to Nationwide of £1.6 billion. The payment was made because Nationwide has taken on ...
Annabel Goldie (West of Scotland) (Con):
Con
I thank the First Minister for providing an advance copy of his statement. It is extremely sad that the Dunfermline Building Society, a name that is synonymo...
The First Minister:
SNP
I welcome the fact that Annabel Goldie thinks that the demise of the Dunfermline Building Society is a matter of sadness. I think that it is, too, and most p...
Jeremy Purvis (Tweeddale, Ettrick and Lauderdale) (LD):
LD
Customers of Northern Rock could have warned the First Minister not to use Robert Peston as his adviser on the best interests of customers of the Dunfermline...
The First Minister:
SNP
I was not claiming Robert Peston as my financial adviser; I was merely saying that he is usually informed before the event of any announcements—so it appeare...
The Presiding Officer:
NPA
We come to back-bench questions. We will get everybody in as long as everybody is fairly short and sharp.
Tricia Marwick (Central Fife) (SNP):
SNP
I welcome the First Minister's very full statement. Is he aware of the fury in Fife that the Dunfermline Building Society, which had been in existence for 14...
The First Minister:
SNP
In very constructive discussions this morning, Nationwide undertook to have a continuing dialogue. Tricia Marwick's latter point is important and we will cer...
Helen Eadie (Dunfermline East) (Lab):
Lab
I declare an interest as a Labour and Co-operative Party member who always values the chance to advocate mutuals.On Monday morning, I woke up to the good new...
The First Minister:
SNP
Frankly, I simply do not understand that last point. I understand that Mr Rennie was in close contact with the management of the Dunfermline over the past tw...
Gavin Brown (Lothians) (Con):
Con
The First Minister said that the Dunfermline's social housing portfolio has been placed in a bridge bank that is wholly owned by the Bank of England to allow...
The First Minister:
SNP
Gavin Brown should read the chancellor's statement from Monday, in which he said specifically that the Scottish Government would be consulted on the future o...
Jim Tolson (Dunfermline West) (LD):
LD
As the local member for Dunfermline West and the area that contains the building society's headquarters, I think that it is at this point extremely important...
The First Minister:
SNP
Yes—that would be highly appropriate. Mr Bernau's conversation with me and Mr Swinney this morning was very positive and constructive. Indeed, perhaps becaus...
Margo MacDonald (Lothians) (Ind):
Ind
I hope that Jim Tolson will forgive me. I will be looking back because I do not have immediate responsibility for the future of the employees. The process is...
The First Minister:
SNP
As Margo MacDonald well knows, I am not a lawyer. It does seem strange that a mutual society can effectively be broken up without a vote by its members. That...
The Presiding Officer:
NPA
If I am to fit everybody in, I will need short questions and short answers from now on.
Sandra White (Glasgow) (SNP):
SNP
I declare an interest as a member of the Dunfermline Building Society. I have certainly spoken in support of Margo MacDonald's position and suggestion.Given ...
The First Minister:
SNP
Of course, it is a parliamentary matter for the Finance Committee to decide what inquiries it wants to conduct. Any minister would be best to leave it to par...
David Whitton (Strathkelvin and Bearsden) (Lab):
Lab
I welcome the First Minister's statement that responsibility for what has happened to the Dunfermline rests with its management. I am sure that that will com...
The First Minister:
SNP
I do not think that only Fifers will be furious at the loss of an independent Scottish financial institution: there will be fury across the country. Perhaps ...
John Park (Mid Scotland and Fife) (Lab):
Lab
The job situation has been the most concerning thing throughout the process. We are concerned that lots of people in the head offices do not have the job gua...
The First Minister:
SNP
We have not to date had such dialogue for the obvious reason that the situation has been developing. We asked that question of the Nationwide this morning, a...