The story so far: the Royal Bank of Scotland having run up losses – £24,000 million at last count – the British government stepped in and bought 84% of the shares.

In doing so, the government took over the bank’s obligations as a going concern – including pension obligations.

It has finally occurred to someone that these include the obligation to pay the generous pensions agreed with the senior executives who mismanaged the bank in the first place.

Ministers are desperately trying to get out of that obligation – even to the extent of suggesting a special Act of Parliament to suspend the law of contract.

To do so would undermine the fragile confidence on which the whole system depends. As Liberal spokesman Vince Cable pointed out, they really have not thought this thing through.

For anyone who is willing to think, here is what we should learn from this experience:

1   There are great opportunities for entrepreneurs looking to pick up a failing business on the cheap, but it might be better to wait for it to go bankrupt and cherry pick the assets one really wants to buy, rather than buy the whole thing as a going concern with all its obligations;

2   If one does buy a going concern, the importance of due diligence cannot be stressed enough;

3   Governments cannot run businesses – their incompetence in this matter proves nationalisation is not the answer to anything; and

4   The whole structure of commerce, not to mention the rule of law, depends on everyone keeping their word, governments and entrepreneurs alike – which makes it doubly important that everyone thinks carefully before giving their word in the first place.