Vince Cable Quizzes PM on splitting up the Treasury and QinetiQ [sic]

1.40.00pm GMT Thu 22nd Nov 2007

[Nov 21] Vincent Cable: I add my condolences in respect of the servicemen and my congratulations to Her Majesty. After the twin disasters of £25 billion of taxpayers' money disappearing down the black hole of Northern Rock and 25 million personal records disappearing in the post, does the Prime Minister accept the wisdom of Tony Blair who said that the Treasury had become far too powerful under its previous incumbent, was no longer fit for purpose and should have been broken up?

Gordon Brown (Prime Minister): This is a new policy from the Liberal party today. I do not know whether the new leader of the Liberal party will want to stick with the policy to break up the Treasury. If the hon. Gentleman seriously believes, as he implies, that we should not be helping Northern Rock depositors and savers, if he seriously believes that we should let Northern Rock mortgage holders go under, then I do not believe he has support in any part of the country. We have taken the right decision-initially supported, of course, by the Leader of the Opposition, who has since backed away from it-to give liquidity to Northern Rock. I hope that the hon. Member for Twickenham (Dr. Cable) will continue to support that position.

Vincent Cable: May I point the Prime Minister to the next Treasury disaster, with the imminent publication of the report on the privatisation of QinetiQ, which I warned about in the debate 18 months ago? Was the Prime Minister not financially very naive when he agreed to the undervaluation of public assets, enabling an American private equity company to make a windfall profit of £300 million and the chief civil servant involved to make a personal fortune of £22 million?

Gordon Brown (Prime Minister): It is very interesting that the hon. Gentleman has not moved to talk about Northern Rock again. I suppose that he is now supporting us in rescuing Northern Rock. I hope that that is a consensus. As far as QinetiQ is concerned, we raised £800 million from the sale. QinetiQ is serving its country under its new ownership and QinetiQ is very important to the Ministry of Defence's future procurement plans.

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