Government plans protest vote on Sir Fred's pension

UK Financial Investments (UKFI), the government body overseeing its banking interests, is planning a protest vote against Sir Fred Goodwin’s £700,000-a-year pension at the Royal Bank of Scotland annual general meeting on Friday.

Although a ‘no’ vote from the 70 per cent shareholder is not binding, it will intensify the row over the former Chief Executive’s remuneration package. John Kingman, the UKFI chief executive, will also use the AGM to confirm support for the bank’s new management, led by Chairman Sir Philip Hampton and Chief Executive Stephen Hester.

Sir Tom McKillop, the bank’s former chairman, maintains that the £17m pension deal was put together with the government’s approval. He is to submit a three-page letter to the Treasury Select Committee this week detailing the negotiation process over Sir Fred’s pension, including the claim that Lord Myners, the City Minister, was well aware of the deal when he signed it off on the government’s behalf.

Under this year’s remuneration scheme, the new chairman could receive up to £1.5m and Mr Hester will receive 10.4 million of the bank’s shares.