The story about Banco Santander and the UK’s taxpayers £18 billion still has not made it into the press. It just shows you the power of Labour spin, and the cleverness of their media manipulation. The story is there on the Treasury website, hidden but clear to anyone who wants to read it.

We were told by the government and the media that the deposits of Bradford and Bingley along with their branches had been sold to Banco Santander for a positive sum. This was never very likely, as deposits are liabilities. You have to pay someone to take them away.

Indeed, that is what has happened. The UK taxpayer is borrowing £18 billion to send £18 billion in cash to a Spanish bank to take the deposits over. The questions that flow from this include:

Did UK based banks have the chance to bid for these deposits with the cash that went with them?

How did they determine the amount of the cash to send?

Why is £14 billion of it being routed through the Financial Services Compensation Fund, which has been offered a government guarantee and a promise of government refinancing of the £14 billion?

Wouldn’t it have been easier and cheaper just to make it all a straight Treasury payment from Day One, as £4 billion is?

Why didn’t the government tell us it was spending another £18 billion of our money in this way? How much of this does it expect to get back eventually from the mortgage book it has kept?

Did the government know when it chose Santander that Santander had poorer capital ratios than the stronger UK banks and was likely to need to raise new capital? It has recently announced that it is raising E7billion in new share capital to improve its Tier One Ratio from 6.3% to 7%.

Shareholders in Bradford and Bingley still await the detailed terms of any compensation for them. B and B is not offering any new mortgages, so like Northern Rock once nationalised it is efectively in run off. Why is the taxpayer having to take the risk and pay all the bills for two mortgage banks who are unable to help the housing and mortgage market by making new advances?