MP opens channel for Osborne probe over RBS share sale

A Labour MP has accused the British Government of “rewarding their cronies and cheating the taxpayer” through its decision to sell-off the first tranche of state-owned shares in Royal Bank of Scotland.

Chancellor George Osborne is facing a potential probe into his decision to sell the shares after former Labour minister Helen Goodman yesterday told MPs she has written to the National Audit Office (NAO) to ask it to assess the deal’s value for money.

Te sale raised £2.1 billion – a loss of about £1bn and a result that Goodman labelled a “disaster”.

He remarks came as a cross-party group of MPs called on the Government to consider suspending the further sale of shares while it looks at alternative options.

The Treasury announced in August it had reduced its stake in RBS from 78.3 per cent to 72.9 per cent, selling the shares at 330p after initially buying them for approximately 500p.

It came seven years after the Government rescued RBS with a £45.5bn bailout at the height of the financial crisis.

Speaking during a debate on RBS, former Treasury civil servant Ms Goodman told the Commons: “One respect in which this share sale is a disaster is that the timing and price of the sale which the Chancellor of the Exchequer has chosen means a loss to taxpayers estimated by his own advisers at £7bn.

“The taxpayer has been given no justification for this and I believe the NAO should look into it.”