Coles told delegates that from speaking with politicians in the last few months, the argument remained that “the “lump sum from selling Northern Rock wouldn’t immediately deliver the windfall that the Treasury is after.”

Philip Collins, former speech writer to the Prime Minister and public policy expert, said that while some financial experts believe that the mutual model would be good for financial services, the government is still considering the idea.

He said: “There is a case for remutulisation as it’s easy to do in principle. However, there’s an ongoing argument between the Cabinet office who are for the mutual agenda and then the Treasury on the other, who are fixed on getting the money back there and then. I suspect that Treasury orthodoxy will prevail.”