Elvis, mad bastards and queues in the streets – Northern Rock revisited
It’s almost exactly 10 years since I was sitting in a large meeting room at lawyers Slaughter and May, surrounded by civil servants, investment bankers, lawyers and consultants, with a colleague whispering in my ear: “The mad bastards, they’re going to do it.”
The “it” was the nationalisation of Northern Rock. I’d been working on this project for nearly six months. The team at the communications agency then called Fishburn Hedges was called the day after it was leaked that the Newcastle bank was in trouble. That morning there were queues on the street and we were urgently summoned to help stop that happening again (allowing me to say to the taxi driver, the immortal words “Take us to the Bank of England”).
At the meeting we learned:
The regulatory structure where HM Treasury, the Bank of England and the Financial Services Authority (as was) were in charge of different elements led to confusion on strategy and objectives;
The customers and the City didn’t trust any of them, or Northern Rock;
Just operating through the media wouldn’t work on its own.
Without going into detail we set about creating an influencer programme. This seems normal now but in 2007 social media was far less influential, hardly anyone in the UK used Twitter, Facebook was then only used by the demographic that now shuns it and the word Millennial hadn’t been coined. We had to identify people who the general public would listen to, who we could brief either ahead of time (if we could trust them) or as soon as we announced anything. As the code name for Northern Rock was Elvis (the “King of Rock”), these were called the Friends of Elvis.
HM Treasury wanted to keep any deployment of the then Chancellor Alastair Darling to a minimum. We agreed as this created a firewall, so that he didn’t become too contaminated if things went wrong, but also allowed us an escalation strategy if no-one was listening to our spokespeople.
Some officials wanted to make the nationalisation announcement while Parliament was in recess, to avoid it being debated in the chamber. Treasury lawyers put a convincing argument that we might have to recall Parliament if we did, and we put a convincing case that this would create just the sort of panic they were trying to avoid.
During the process we managed to rationalise the decision making so that when we worked on other rescues – Bradford & Bingley and Dunfermline Building Society are two in the public domain – the Bank of England managed the process. This, alas, didn’t stop a Treasury lawyer holding up the B&B announcement until about two minutes before the Chancellor was due to appear on the Today programme.
In the end, I would say the rescue of Northern Rock was handled about as well as we could in the circumstances. There were no leaks, no panic and, by the time it happened, pretty much everyone accepted it was the best solution.
And we could say: “Elvis has left the building.”