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Northern Rock

Lord Barnett asked Her Majesty's Government:

Lord Davies of Oldham: The figure quoted includes debt securities issued by Northern Rock as well as the other entities consolidated in the group accounts. Holders of debt securities issued by Northern Rock have a claim against the assets of Northern Rock as creditors of Northern Rock according to the terms of those securities. However, debt securities issued by the various securitisation vehicles set up by Northern Rock are secured against the assets of the relevant issuer, and those bondholders have no recourse to Northern Rock for repayment of their bonds.

Lord Barnett asked Her Majesty's Government:

Lord Davies of Oldham: None of these securitisation issues is secured against the assets of Northern Rock plc.

Lord Northbrook asked Her Majesty's Government:

Lord Davies of Oldham: The Dolerite bonds were fully redeemed in August 2007.



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Lord Northbrook asked Her Majesty's Government:

Lord Davies of Oldham: The securities issued by Whinstone are not covered by the guarantee arrangements.

Northern Rock has a commercial relationship with Whinstone and any funds deposited with Northern Rock by Whinstone would be covered by the guarantee arrangements in the same way as any other wholesale deposit. Northern Rock has entered into credit default swaps with Whinstone on a commercial basis and payments under these contracts would be covered by the guarantee arrangement.

The bonds issued by Dolerite were fully redeemed in August 2007.

Lord Barnett asked Her Majesty's Government:

Lord Davies of Oldham: The Financial Services Authority has assessed that Northern Rock has a mortgage book of good quality and remains solvent. It is a matter for its management to release specific business updates.

Lord De Mauley asked Her Majesty's Government:

Lord Davies of Oldham: The Government have set a clear strategic aim for the board of Northern Rock plc to move the bank off all forms of public sector support at the earliest appropriate opportunity, but are not setting an arbitrary deadline for returning Northern Rock to the private sector. It is for the new board to develop a strategy that best serves the objectives of Government, as sole shareholder and guarantor, in particular to protect taxpayers and depositors and promote financial stability.

Lord De Mauley asked Her Majesty's Government:



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Lord Davies of Oldham: The Chancellor of the Exchequer and the executive chair of Northern Rock, Ron Sandler, have both made clear their commitment to ensuring that the company does not compete unfairly on the back of government support. Furthermore, any support to Northern Rock will be subject to scrutiny by the European Commission against the state aid rules, which prohibit unfair distortion of competition. The UK Government have made clear their commitment to adhering to these rules.

As further reassurance, HM Treasury has asked the Office of Fair Trading to prepare an annual report assessing the competitive impacts of Northern Rock's business on the markets in which it operates.

Lord De Mauley asked Her Majesty's Government:

Lord Davies of Oldham: Northern Rock is under no contractual obligation to sell further mortgages to Granite. Any decision by Northern Rock to sell mortgages to Granite would be taken for commercial reasons and in light of the strategic plan to be agreed with the Government.

Lord De Mauley asked Her Majesty's Government:

Lord Davies of Oldham: Northern Rock operates on an arm's-length basis from Government as a commercial entity in a competitive environment. It is inappropriate for the Government to comment on the details of Northern Rock's mortgage book.

Ron Sandler, Northern Rock's executive chair, is developing a strategic plan as a matter of priority and will present the plan to the Government shortly. The plan is subject to government approval. Any subsequent major decisions will need the approval of the Government—as in the case of any publicly owned company.

Lord Taylor of Warwick asked Her Majesty's Government:

Lord Davies of Oldham: The Financial Services Authority has confirmed in its business plan 2008-09 that it will publish the conclusions of its review of lessons learnt from the Northern Rock situation in March 2008



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Pensions: Disregards

Baroness Hollis of Heigham asked Her Majesty's Government:

The Parliamentary Under-Secretary of State, Department for Work and Pensions (Lord McKenzie of Luton): The information is shown in the table below.

The estimates refer to the annual cost of introducing a £12 weekly private pension income disregard for all income-related benefits (pension credit, housing benefit and council tax benefit), in 2008-09. The disregard has been increased by earnings in each year following 2008-09.

£ billion, 2007-08 prices2015-162025-262050-51

Annual Cost

0.6

0.9

1.5

Source: WP Microsimulation Modelling

People Trafficking

Lord Hylton asked Her Majesty's Government:

The Parliamentary Under-Secretary of State, Home Office (Lord West of Spithead): We are not convinced that the provision of legal guardians for children who are believed to have been trafficked would provide significant additional safeguards to those that already exist nor reduce the number of children who go missing.

Local authorities already have a statutory duty to ensure that their functions are discharged having regard to the need to safeguard and promote the welfare of all children under Section 11 of the Children Act 2004 regardless of their immigration status. They also have responsibilities for unaccompanied children, as well as those who arrive in the UK with their parents and for whom there are concerns regarding their safety and welfare.



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The protection and subsequent care plans for each child are based on assessments of individual needs. Such assessments are already subject to external scrutiny through a number of statutory routes.

Polygamy

Baroness Park of Monmouth asked Her Majesty's Government:

The Parliamentary Under-Secretary of State, Department for Work and Pensions (Lord McKenzie of Luton): Because legislation does not provide entitlement to benefit payments to anyone in a polygamous marriage that is illegal under British law, there should be no such cases.

Prostitution

Lord Hylton asked Her Majesty's Government:

The Parliamentary Under-Secretary of State, Home Office (Lord West of Spithead): No final decision has yet been made on the level of future funding for these services so we are not in a position to provide precise figures.

Railways: North Wales

Lord Roberts of Llandudno asked Her Majesty's Government:

Lord Bassam of Brighton: If the Department for Transport (DfT) were to propose a change to extend West Coast Trains services to and from Wrexham then it is likely to generate an increase in subsidy to the train operator. There are currently no plans for DfT to initiate such a change. However, from December 2008, West Coast Trains is planning to operate an additional 0705 Wrexham General to Chester and 2020 Chester to Wrexham General service as a commercial proposition.



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Shipping: Irish Lights

Lord Berkeley asked Her Majesty's Government:

Lord Bassam of Brighton: The estimated contribution made by UK shipping to the provision of aids to navigation in the Republic of Ireland in each year since 2002-03 is set out in the evidence study following the review of funding for the Commissioners of Irish Lights published on 3 March. Data before that date are not readily available. The estimated contribution, as the report points out, arises out of the provision of an integrated service throughout Great Britain and Ireland.

The UK contribution will be the subject of discussions between the two Governments in determining a long-term funding solution. It is too early at this stage to say when negotiations will be completed and a new agreement put in place.

Lord Berkeley asked Her Majesty's Government:

Lord Bassam of Brighton: The Irish Lights Evidence Study was published with the agreement of the UK and Irish Governments. Copies of the report were placed in the House Libraries on 3 March 2008.

Two key findings of the study were that the proportion of the Commissioners of Irish Lights (CIL) expenditure falling in the Republic was 85 per cent, rather than the 70 per cent assumed in the 1985 agreement and that the General Lighthouse Fund may be contributing in total £8.5 million a year to the funding of lights in the Republic. This figure also includes CIL's portion of the costs borne directly by the General Lighthouse Fund on behalf of the three General Lighthouse Authorities which are currently excluded from the 1985 agreement.

The Answer by Baroness Crawley, which gave an estimate of £6.4 million for the annual contribution in 2005-06 to the provision of aids to navigation in the Republic of Ireland was based on the outcome

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assumed in the existing 1985 agreement, that is to say that the North/South expenditure split was 30/70. Redundancy costs in that year were also excluded from that figure and CIL's sundry income was netted off in arriving at that figure.


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