Mr. Kevin Cardiff:

Okay. On the genesis of the broad guarantee, where did the idea come from? Well, it wasn't a new idea, it had been done in other crises and other places. And, as I laid out in my written statement and the appended report, no consideration of bank rescue options could have ignored the potential for use of guarantees. In the Northern Rock case is one example. It was not nationalisation ... it wasn't the point when they nationalised Northern Rock that the situation stabilised but it was the guarantee that did the trick there. Maybe we over-learnt that message. But there were also significant external voices who'd been expressing support for a broad guarantee, or something like it, at various points in time between March 2008 and the guarantee itself. I don't think I was influenced, in any advice I gave, by the presence of those external voices. So, of course, it's entirely legitimate for anyone who wants to contact the official system and give their personal view to do so. It was just in the air. The idea of a guarantee was in the air and I suppose that was captured in the McWilliams article that weekend.

So what about the bailout? Well at the time we said it wasn't a bailout because it was money lent not money given, but we can call it a bailout for this purpose. My report to the inquiry deliberately gives a lot of detail on how those discussions unfolded because it hasn't been much discussed. The big question in the public domain in relation to the bailout seems to be whether entering the EU-IMF programme was a free choice or were we pushed. Well, at the moment we entered it we were pushed quite hard. The push was in some elements, in some ways direct and transparent. You have seen the letter from-----