Get some respect

7 February 2008 By Edward Hadas

The Office for National Statistics has confirmed what everyone knew that the government is on the hook for £75bn of Northern Rock s liabilities. It would almost certainly do the same for any other stricken bank. It should take up the authority that goes with the responsibility.

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Northern Rock was officially reclassified as a public sector company, announced the Office for National Statistics on February 7 2008.

The change is backdated to be effective from October 9 2007, when Northern Rock's support from the Bank of England was amended such that the central bank had influence over certain corporate activities.

The reclassification would add the Rock's debt to the government's public sector net debt. Government guarantees to creditors will be classed as contingent liabilities and are excluded unless they are called.

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