Ben Chu: When is a bonus not a bonus? When it's an L-tip

Outlook Sad to say that RBS announced the appointment of Ross McEwan as the new chief executive alongside an attempt to pull the New Zealand wool over our eyes. We were informed last week that the Kiwi will receive no bonus next year. But check your wallets, taxpayers. The outgoing boss, Stephen Hester, also supposedly received "no bonus" in 2012. In fact, as the bank's most recent remuneration report shows, he was awarded £1.6m worth of RBS shares under the bank's long-term incentive plan (L-tip) for his work in 2012. That was 135 per cent of his salary for the year.

Ah, but the L-tip is a long-term incentive so it's different, isn't it? Not really. How long will Mr Hester have to wait before he receives those shares and, if he so wishes, sells them? The answer: three and a half years. Yes, for the bank we taxpayers bailed out in 2008 the "long term" is apparently 42 months. Do you find that as reassuring as I do?

Three and a half years, by the way, is almost exactly the period over which a typical RBS trader would have to wait to receive the final instalment of his annual share bonus. That means there's little practical difference between an annual bonus and an L-tip award at RBS. Oh and the bank also told us last week that Mr McEwan will be eligible to receive an L-tip in 2014. Meet the new boss, depressingly similar to the old boss.