The government's £1 billion gift to Richard Branson ?

Alastair Darling's appearance on PM today was remarkable.

Despite being asked several times by Eddie Mair he could or would not answer these questions:

1. Is there a cap on the taxpayers' liability? (the answer was no, one assumes, as Darling wouldn't give a straight "yes")

2. On what date will the taxpayers' liability for Northern Rock end? (despite being asked several times from Mair, who was going into Paxo mode on this one ("What's the date?" x 3), no date was forthcoming from Darling).

3. Can you say that the taxpayers' money is safe and secure? (Can he 'eck as like)

Basically, the taxpayer is being abused. Public money is being used to underwrite the risk of a private purchase of Northern Rock. There are no guarantees that taxpayers' money will not be wasted or lost. Dickie Branson must be laughing himself silly. He's laughing all the way to his Virgin Bank. All the risk is with the taxpayer. Virgin have the remarkable opportunity to make profit without risk.

The BBC's Robert Peston says that the proposal means that the taxpayer will support the bank with £25 billion and could still have a financial obligation to the bank five years from now. Peston describes the scale of the government package as "breathtakingly large and without precedent". Peston says that the "guarantee would be the equivalent of a one-off injection into the Rock of more than £1 billion, a subsidy of that amount".

All this is because the government has decided that safeguarding taxpayers' money is not the first priority. Their first priority is to avoid what they, wrongly, regard as the humiliation of "nationalisation" of a bank. Brown wants to save face and avoid being compared with the old Labour nationalisation guard by the likes of the Daily Mail. He is prepared to seel taxpayers down the river in order to save face. It is scandalous.

I'm delighted that Vince Cable unravelled all the double-talk from the government and simplified the situation with his usual economist's authority:

The reality is the Government has ingeniously come up with a private sector sale that doesn’t involve any private sector money.

“In order to save face Brown has decided that losses of Northern Rock should be nationalised, but that profits should be privatised.

“Taxpayers now face years of underwriting Northern Rock, giving the opportunity for a private bidder to make an absolute killing - this is of course assuming that the EU decides that the Government position of guarantor is even legal.