To hear Robert Peston‘s account of the financial crisis you might wonder where he gets his information. He is a terrific reporter and seeker-out-of-scoops. But at what point does a journalist with really cut-glass sources stop being a journalist and start being – well – a cypher?
And in the current financial crisis, just when does a cypher become a syphon? The author of Brown’s Britain might well wonder.
Take this version (go to the 8am news belt or see the version blogged here) of events surrounding the nationalisation of the Bradford and Bingley on Monday morning, just as the Tory Party conference kicked off (disclosure: I’m not a Conservative).
Sounds like it could have come straight from the cold hard lips of a Brown loyalist like…Sue Nye. Surely though, Peston isn’t just a government spokesman? His job title, after all, is Business Editor.
Here’s some of his live from the Today programme. Judge for yourself:
The most politically explosive aspect of Bradford and Bingley’s nationalisation is how much risk of losses is being born by the taxpayer.
The answer, surprisingly, is not much.
Because the bulk of any future losses will be born first by shareholders and providers of what’s called subordinated debt.
And after that losses – up to a staggering £15 billion – would fall on our beleaguered banking industry.
For taxpayers to lose a penny Bradford and Bingley’s future losses would have to be unthinkably huge.
The reason taxpayers are protected is that on Saturday the board of the Financial Services Authority, the City watchdog, ruled that Bradford and Bingley was unable to pass the test of being a viable bank, and therefore a claim was triggered on the insurance scheme for bank depositors, the Financial Services Compensation Scheme…
Depositors won’t lose a penny…
But for now it looks as though taxpayers at least are off the hook even though this is a very substantial nationalisation…
Is that the Authorised Version? It certainly sounds like the Treasury line. Taxpayers are often bank customers, Peston might have noted in passing.
For Peston, the senior servant of a government-financed broadcaster, the balance between evaluating what he’s ‘learned’ and repeating what he’s told must be an uncomfortable one.
But the blame for his predicament resides firmly with the people leaking this information – a government that is prepared to dispense important public information second hand.