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Rock not government responsible for £100m pension deficit, adviser says

17 January 2008 / by None
The crisis at Northern Rock is the responsibility of their management and not the government, an expert has said.

Northern Rock's crisis resulted in the bank asking the government to offer its members protection, yet the adviser claims on Citywire that this is misplaced.

Joss Harwood, of Eldon Financial Planning in Durham, said: "Putting emergency measures into place to protect depositors and a potential knock on effect in the banking system is entirely different to rescuing employees from the consequences of mismanagement."

She went on to say that, while the pension trustees were left with little option but to take such action, it is not in keeping with "investment theory".

The board of Northern Rock are now due to have a critical meeting to determine the future of the bank, report Citywire.

In related news, shares in Northern Rock fell over 20 per cent to their lowest ever amid speculation that the bank will be placed under state control, reports Reuters.

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