Brexit & EconomyPoliticsTreasury rocked to the tune of £15m

Treasury rocked to the tune of £15m

Fallout from the lost data discs and the collapse of Northern Rock have cost the Treasury £15m

In its Spring Supply Estimate, the Treasury disclosed that it would need
£14.7m of extra funds to cover the ‘costs of work on
Northern Rock and
the Poynter Review,’ but stopped short of providing detailed breakdowns.

The figure is the first general estimate of what those who worked on both
issues may have earnt, with
PricewaterhouseCoopers chief
Kieran Poynter leading the HM
Revenue & Customs
review and investment bankers
Goldman Sachs
providing extensive advice over Northern Rock.

The extra cash had to be drawn from the government’s general bank account at
the Bank of England and it appears that the figure came to light because of
statutory disclosure requirements. The number was buried in a 28-page document
which requested more cash for the year ending 31 March 2008.

The costs are likely to have included fees paid to bidders as part of the
collapsed sale of Northern Rock.

The government has so far given no indication of the costs it has shouldered
as a result of the Poynter review of the loss of child benefit data discs. But
the fees are likely to be significant, given the profile of the review’s author,
and the fact that it has been going on for several months.

As well as being involved in the Poynter review, PwC will have earnt fees
from the sale of the bank, which it was also working on, it has admitted.

Investment bank Goldman Sachs was brought in as the lead adviser for the sale
of the bank. Other firms apart from PwC were involved in advising bidders,
according to Treasury insiders, making up part of the costs of the affair.

Auditors have already faced accusations of conflicts of interest in relation
to Northern Rock.

MPs were up in arms to discover that PwC earnt £70,000 a time for signing off
Northern Rock’s securitisations.

A Treasury source said: ‘The adviser fees for Northern Rock have since been
repaid to the Treasury by [the bank] and figures relating to fees on the Poynter
Review have been paid by HMRC.’

Related Articles

Financial Secretary to the Treasury on cryptocurrency, Brexit and taxing the digital economy

Brexit Financial Secretary to the Treasury on cryptocurrency, Brexit and taxing the digital economy

4w Alia Shoaib, Reporter
HMRC’s refusal to raid top Tory donor Lycamobile to be investigated by MPs

Big Four HMRC’s refusal to raid top Tory donor Lycamobile to be investigated by MPs

1m Alia Shoaib, Reporter
Spring Statement 2018: Spring has sprung as chancellor finds his inner Tigger

Budget Spring Statement 2018: Spring has sprung as chancellor finds his inner Tigger

2m Emma Smith, Managing Editor
Spring Statement live feed

Budget Spring Statement live feed

2m Emma Smith, Managing Editor
Spring Statement 2018: 5 things to look out for

Brexit & Economy Spring Statement 2018: 5 things to look out for

2m Alia Shoaib, Reporter
Financial Secretary to the Treasury on Brexit, Spring Statement, Making Tax Digital and Carillion

Politics Financial Secretary to the Treasury on Brexit, Spring Statement, Making Tax Digital and Carillion

4m Emma Smith, Managing Editor
David Davis, Secretary of State for Exiting the European Union

Brexit & Economy David Davis, Secretary of State for Exiting the European Union

4m Alia Shoaib, Reporter
Philip Hammond, Chancellor of the Exchequer

Brexit & Economy Philip Hammond, Chancellor of the Exchequer

4m Alia Shoaib, Reporter