All in it together? RBS fat cat “in line for £7m payout”. Seven. Million

Shamik Das reports on RBS chief Stephen Hester’s obscene bonus and pay packages - which could see him receive seven million pounds for 2011.

 

As winter’s icy chill blasts millions of Britons up and down the land, with wages frozen, jobs lost and benefits slashed – with even cancer patients and disabled children not spared by the Cabinet of the compassionless – for at least one individual, there’s reason to cheer.

RBS chief Stephen Hester’s 2011 pay packet could reach £7.38 million. Seven million, three hundred and eighty thousand pounds.

That’s right, those responsible for the crisis are rolling in the dough once again, as if there’d been no recession, while those that had nothing to do with it are paying the price. Fair? Fair???


The Telegraph reports:

In a statement on Thursday night, the bank said Mr Hester would get a bonus of £963,000 as the taxpayer-backed lender bowed to political and public pressure to ensure its chief executive was not handed more than £1m.

However, the bank admitted Mr Hester was still potentially eligible for an award under a long-term incentive plan (LTIP) worth as much as £4.8m.

This means his total pay package for last year including his £1.2m salary and £420,000 pension could reach £7.38m.

If Mr Hester were to receive his maximum LTIP grant it would take the total value of the awards made to him since he took over as chief executive in October 2008 to about £27.5m.

The actual value of these awards is likely to be substantially lower than this due to the collapse in RBS’s share price over the last 12 months.

As foreign office minister Jeremy Browne told Question Time last night:

“There’s a question of honour. Even if there’s a contractual opportunity for him to have a bonus it doesn’t mean he has to accept it… He is effectively a public servant in a bank which is almost completely owned by us the taxpayers.

“He needs to think like a public servant who has a duty to his country, not just his own wealth… No-one’s forcing him to take this money. He could struggle on with £1.2m.”

All in it together?

See also:

Cable fails to provide a stick or carrot in the fight against obscene payDuncan Exley, January 24th 2012

Three things Cameron should do if he’s serious about high payDuncan Exley, January 9th 2012

How bankers’ bonuses are contributing to the new credit crunchCormac Hollingsworth, December 6th 2011

All in it together, eh Gideon? FTSE fat cats see pay rocket 50 per centShamik Das, October 28th 2011

Coalition fails “moment of truth” on bankers’ bonusesWill Straw, February 9th 2011

43 Responses to “All in it together? RBS fat cat “in line for £7m payout”. Seven. Million”

  1. Joseph Burnett

    All in it together? RBS fat cat “in line for £7m payout”. Seven. Million: //t.co/WA5U2QjP reports @ShamikDas

  2. Shamik Das

    All in it together? RBS fat cat “in line for £7m payout”. Seven. Million: //t.co/WA5U2QjP reports @ShamikDas

  3. Acid Fascists

    All in it together? RBS fat cat “in line for £7m payout”. Seven. Million: //t.co/WA5U2QjP reports @ShamikDas

  4. David Irvine

    All in it together? RBS fat cat “in line for £7m payout”. Seven. Million: //t.co/WA5U2QjP reports @ShamikDas

  5. Carlos Asenvader

    RT @leftfootfwd: All in it together? RBS fat cat “in line for £7m payout”. Seven. Million //t.co/EiEEg0Q3

  6. Ian G-Whittle

    All in it together? RBS fat cat “in line for £7m payout”. Seven. Million: //t.co/WA5U2QjP reports @ShamikDas

  7. leftlinks

    Left Foot Forward – All in it together? RBS fat cat “in line for £7m payout”. Seven. Million //t.co/m7Lzq4m4

  8. Patron Press - #P2

    #UK : All in it together? RBS fat cat “in line for £7m payout”. Seven. Million //t.co/smoY697P

  9. Pulp Ark

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  10. Blair Walker

    All in it together? RBS fat cat “in line for £7m payout”. Seven. Million: //t.co/WA5U2QjP reports @ShamikDas

  11. Patrick

    Did bankers really ’cause’ the crisis, though?

    The ultimate cause of the crisis was people (predominantly in the US) taking out mortgages which they couldn’t afford and then defaulting on the loan. If this had not happened then there would have been no financial crash. Bankers made these loans using algorithms of historical loan-default rates. If they had suspected the loan default rate was going to be so high that it would threaten to bankrupt their bank, lose them their jobs and the destroy the entire financial system, then they would have used a different algorithm, it’s as simple as that.

    It’s all very well to look back after the fact, and say, “Oh those greedy bankers, look what they’ve done!”. But I don’t remember the Left out demonstrating at the time, marching into the City of London, camping in the streets, clamouring for a change to mortgage lending policies. It was every man for himself as people jumped over each other to get on the housing ‘ladder’ and the biggest mortgage they could. And it was that failure of personal responsibility -only borrow what you can afford, always pay your debts- that caused the banking crisis.

    The media, especially the Left, loves to trot out these dependable demon-figures as they are easy and populist explanations of a situation whose causes are rather more complex.

  12. Selohesra

    It is a lot easier for lazy thinkers to just bash the bankers. Certainly they were at fault as were the politicians who encouraged them/let them get away with things and more importantly as were the electorates who voted for parties prommissing reckless spending and endless hand outs from the newly discovered money tree.

    Hester did not cause the problem he is trying to sort it out – I for one would rather we paid the going rate for this role in the hope of getting something back for the taxpayer than appoint a cheap nobody and never see any return back on the money pumped into RBS

  13. Anonymous

    The last crisis was caused by people not paying their debts.

    The current crisis is being caused by people not paying their debts.

    The last one, was people who borrowed money for property.

    The current one, which is going to get far far worse, is caused by governments.

    7,000 bn of debt in the UK, run up by governments.

    You’re complaining that the public sector pensions are being done over, and that is what is happening. However, that’s not an ‘official debt’, so none of it has to be paid. Right?

    225,000 per taxpayer.

    How are you going to pay your share?

    Now for the language.

    You are blaming all bankers (Hester included), for what a small group did. Loan money to people who defaulted.

    Now, swap banker for black or jew.

    All blacks are to blame for the few that commit crimes.

    Yep, shows just what your real attitude is. No difference to that of an antisemite or racist.

  14. Anonymous

    On the deficit. That’s the government’s fault.

    Perhaps you are now in favour of government workers getting their pay cut until the deficit is down to zero?

    What about them working for free until the government debt is paid off?

    By your logic, because Gordon Brown made mistakes *Ed Balls and Milliband have admitted to this”, you want to punish all government workers.

    Yep, just show what hypocrites you are.

  15. Janet Graham

    All in it together? RBS fat cat “in line for £7m payout”. Seven. Million: //t.co/WA5U2QjP reports @ShamikDas

  16. Derek Paterson

    "He could struggle on with £1.2m" //t.co/iG7Cz2KN Hester's total package could reach a potential £7.38m this year #RBSdisgustme

  17. Mwilson107107

    Did anyone notice Michael Fallon on BBC defending the payout, with the tagline ‘Treasury Select Commitee’, instead of the usual ‘Conservative Party Chairman’ used when slagging off the Labour party.

  18. Redisbleu

    I think what people below may be missing here is why does ANYONE need that big of a bonus. Seriously, Seven Million Pounds during a crisis where poor people are being thrown onto the trash heap? He’s already getting a fair bit of dosh during the year, and that’s just ridiculous. If we’re “all in it together” then surely the point is that someone could give up a bonus for a year and lend a hand, but they aren’t. It’s comparing the hardship of not being able to upgrade the yacht to the hardship of whether or not you can afford to eat. It isn’t rocket science but I’m sure someone will come along and scoff at me pointing out the flipping obvious.

  19. Alex Braithwaite

    RT @leftfootfwd: All in it together? RBS fat cat “in line for £7m payout”. Seven. Million //t.co/OYPVj37T

  20. Geoff Morris

    All in it together? RBS fat cat “in line for £7m payout”. Seven. Million … //t.co/jFo2Nrw6

  21. Doug Fisher

    All in it together? RBS fat cat “in line for £7m payout”. Seven. Million … //t.co/RGCjs5u4

  22. BevR

    RT @leftfootfwd: All in it together? RBS fat cat “in line for £7m //t.co/ROjee9gx

  23. The government has the power to stop Hester’s bonus, they just don’t want to | Left Foot Forward

    […] also: • All in it together? RBS fat cat “in line for £7m payout”. Seven. Million – Shamik Das, January 27th […]

  24. Patrick

    That level of bonus is the simply the going rate for that level in that industry. That’s difficult for most people to understand as they don’t work in Finance and aren’t CEOs of huge companies. If a company feels their employee is deserving of a bonus, then he or she should have it.

    Why are some jobs paid more than others? Why does a dentist earn multiples of what a car mechanic does? They’re both essentially manual jobs that require knowledge, training and technical skill. Yet no-one is demonstrating outside their local dentists. It’s the same principle.

    And how about actors? No-one ever complains about the millions they earn. Perhaps Jude Law should donate a year’s pay to the Treasury. Yet’s that’s not something you ever hear suggested. Is that because actors are seen as fun, entertaining, and good looking, whereas bankers are just boring men in suits that sit in offices doing things that people don’t understand and find it difficult to attach value to.

  25. Redisbleu

    My ex husband writes the software for these banks to do their international trading. Yes, I know the industry. And “well that’s the industry” isn’t a good excuse. Who the feck can spend all that money in one go? My ex’s bonus is more than I will see in an entire year, but he won’t take over care for his own son – “too expensive” he said. Lovely. So I do a job which would cost an agency £100,000 a year to do, and I get £55 a week for it…and I’m called a scrounger for getting that at all; because of course raising the next generation of tax-payers isn’t important, especially if said future tax-payer needs a lot of work to get to that stage in the first place (since my son is disabled). I’m doing an essential job and the paper is filled daily with how people like me are a drain in the system. I suppose if we’re going to use the “No one knows how much work it is”, I’d invite someone to try and educate and care for my son for a week, and then tell me I’m not entitled to support to do so because it’s clear no one else wants the job.

    Money I earned didn’t go to bail out starving actors last year, or yes I’d be picketing. However I also am not a big fan of footie players or artists; I don’t watch telly, I don’t watch footy as a result. But last I checked they do pay their taxes and don’t dump it into offshore so they don’t have to. Quite a few donate to charities. But as I’m well aware of how bankers think thanks to one too many company picnics where I’d have to be the Supportive-and-Subordinate-Wife role, I heard what these fellows spent their bonuses on, and it sure wasn’t charity.

    If Paul Newman and Bill Gates could decide they had finally made enough money and therefore refused to make any more (and indeed gave the rest of their earnings away to charity) then maybe your idea isn’t as “ridiculous” as you’re trying to claim it is. Baroness Meacher is already on record saying she would happily give up some of the perks she has as a member of the House of Lords so that the disabled don’t have to. I would therefore suggest that “Oh but it’s expected” isn’t really a good excuse…nor is a lack of empathy or compassion, although it doesn’t seem to stop those claiming these extortionate bennies (oh my, benefits!).

  26. Redisbleu

    “Starving actors” wasn’t what I meant, but actors who had over-spent and took a risky gamble, then lost the lot and got a deal under the table to pay it back…yes, that would be the same issue and I’d be just as irked.

  27. cameronsdemise

    If he thinks he is that Clever , pay him his Salary and all bonuses with the proviso that ,he invests the bonuses part of his award into starting up a new business to employ at least 100 people , employed at a more than minimum wage ( Say £15.00 per hr ) for a cleaner , no one must be paid less than the stated £15.00 per hr ! let him prove just how clever he really is , I Suspect that he is more clever than the Dumplins who signed his Contract , but not that clever that he could pull off the above !!.

  28. Look Left – The hate-filled Right hone in on their next target: Disabled people | Left Foot Forward

    […] we said earlier today: “As winter’s icy chill blasts millions of Britons up and down the land, with […]

  29. cameronsdemise

    Well , if you were loaded and you were still looking for more , would you lend your own money to someone whom you thought was unable to repay with minimum interest ? or would you still do it but with someone elses money ? bet the latter is probably the most pertinent answer . GREEDY BANKERS , YES ! As LONG AS IT’S NOT THEIR MONEY , ANYTHING GOES .

  30. Patrick

    Are you suggesting that banks should only be able to lend out the personal assets of their employees then? Really, we’re all ears.

  31. Sal Pou

    All in it together? RBS fat cat “in line for £7m payout”. Seven. Million //t.co/ZQTPA9TQ

  32. Eva Miranda

    All in it together? RBS fat cat “in line for £7m payout”. Seven. Million: As winter's icy chill blasts millions … //t.co/scFmpWtK

  33. Terry Barridge

    All in it together? RBS fat cat “in line for £7m payout”. Seven. Million //t.co/czqn9xMz

  34. Dantee

    All in it together? RBS fat cat “in line for £7m payout”. Seven. Million: If they had suspected the loan default… //t.co/2EvkO6Ap

  35. Newsbot9

    No, I’m in favour of fairly taxing your 1% until the debt’s back down to a reasonable level. Then keeping fair taxes and using them to fix issues.

    Of course, your answer is to cut taxes, and the hell with anything else.

  36. Newsbot9

    Of course you’re an anti-semite and a racist, this is absolutely no surprise.

    Do keep trying to excuse the damage your profession has done to this country though, pretending it’s a fundamental like race. No, you are to blame, and you are responsible. The debt is yours, and a sane government will deal with it as such.

  37. Newsbot9

    No, it’s easier for your 1% to try and blame everyone else.

    Hester caused the problem. Hester is to blame. He’s not solving anything, he’s making things worse. You’re just, as corporatists do, putting collective interests of legal fictions above people.

    The going rate should be going to jail.

  38. Anonymous

    I agree. The bankers who caused failure should be jailed.

    Likewise for those in government running frauds, and hiding the debt.

  39. Anonymous

    Hester caused the problem

    ===============

    Hester was put in to clean up the mess caused by the previous incumbant. He didn’t cause the problem at RBS.

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