Northern Rock and Banking Reform

That is still to be worked out. We are looking at the banking sector at the moment, but the Government's consultation is open on that matter. I suggest that my hon. Friend contributes to that process, because I know that he is interested in the mutual sector. The Committee suggests that the Government provide initial funding through a loan that the banks pay back as they become less constrained. There is a role for Government in the process. The report, ““Financial Stability and Depositor Protection””, is out for a consultation exercise, and it is clear that the Government and the Committee agree on a number of issues. The first thing we agree on is the need for a prompt, corrective action system. If such a system were in place, it would prevent a failure in the first place. Secondly, we agree on the need for a bridge bank authority, which would allow failing banks to be taken into public ownership and allow them to be let out of that ownership, as and when it was convenient. That system exists in America, and it works very well.