It was not the governments preferred option but I, in voting for the measure, was convinced that it was the right thing to do. I also think the criticism of Alistair Darling is entirely misplaced. Every one of us who has savings in a bank or building society is more secure as a result of Government action.

Let me explain.

Banks and building societies borrow and lend money as a business. They borrow money from we investors but also from the "wholesale market", i.e. other banks and financial institutions who have money to spare. The average building society probably borrows 70% of its money from private investors and tops up from the wholesale market. Northern Rock management last year adopted a more aggressive approach and in fact borrowed 70% of its cash from the wholesale market. When the big boys asked for their money back and the sub-prime lending crisis in the USA resulted in a drying up of credit, they ran out of funds.

It was then that the government, through the Bank of England, were approached to help.

The choice was clear. Either the government could say "yes" or "no deal" and effectively condemn Northern Rock to the receiver who in the fullness of time would have liquidated the company. If the government had failed to help the knock-on effect on other banks and institutions could have been catastrophic. We all know about the run on Northern Rock. What if the financial institutions had all suffered in the same way. Restoring stability was central for the benefit of us all. Not just Northern Rock investors.

That's why the government guaranteed the investments in Northern Rock and stumped up public money where the wholesale markets had failed. In principle, all the borrowing to Northern Rock is covered by the mortgages they lent, provided, that is, that the properties are sufficient to cover the loans. In the main that will be the case but there may be exceptions.

Having assisted Northern Rock in that way and having guaranteed the banks debts, the question then was "what next?". The Chancellors obligation was to keep stability in the market (the very purpose of the initial decision) but also to safeguard the public investment (or, rather, guarantee). The preferred option was to encourage another private investor to take over the bank bringing with it its own capital resources whilst continuing to receive some diminishing Government guarantees over a period of time.

In the event and in the current unstable market, no offer was good enough to ensure stability and the security of Government investment, thus temporary nationalisation was the only option.

The nationalisation of Northern Rock will therefore enable the government to keep control of its investment until such time as the markets are sufficiently stable for a private investor to move in. I acknowledge that this is not the perfect solution as, of course, Northern Rock must become leaner and fitter and new business will be a problem.

I feel sorry for the shareholders in that the compensation they will now receive is likely to be minimal, although that has yet to be decided by independent valuation. What is clear, however, is that anything that the shareholders receive is likely to be more than if the government had failed to intervene when the crisis first occurred. Northern Rock in receivership would have returned nothing to their shareholders and their investors could also have been at risk That's quite apart from the knock-on effect.

Fortunately, the poor decisions of Northern Rock management is not generally reflected across the banking sector in the UK. Thank goodness. The Chancellor has certainly been between a "rock and a hard place" but what's interesting is that no-one has seriously suggested he was wrong to intervene and no-one has come up with a workable alternative.