Myners defends RBS after row over pay
City minister Paul Myners yesterday came out with a show for support for embattled Royal Bank of Scotland.
At a hearing of the Treasury Select Committee Mr Myners said that placing too many curbs on pay at the company could damage its ability to compete. "If we want RBS to compete in a global world... it has to equip itself appropriately to do that," he said.
"If we said to RBS that you can only pay your key employees up to the national average... or some other arbitrary figure, the effect would be a significant erosion in the competitiveness of the bank, the loss of its ability to (provide) credit, a loss of employment - particularly in Scotland - and a decline in the stature of the bank."
The minister's words follow several such warnings from RBS, which is 84 per cent owned by the state, itself. Chief executive Stephen Hester has railed against what he called the "politicisation" of the bank, although at a hearing of the same committee on Tuesday he backtracked and said he regretted his earlier words.
RBS has become the focus of the government's tough tactics pay. It has been forced to agree to slash cash payouts and handed the Treasury a veto on its 2009 pay policies as a consequence of its entry into the state-backed "asset protection" scheme. However, it has secured agreement from UK Financial Investments, the body overseeing the Government's interest in the banking sector, for this years pay plan.
RBS is 84 percent owned by the tax payer after the Government pumped billions of pounds in to stave off a possible collapse. Mr Hester was appointed to lead the recovery after his predecessor Sir Fred Goodwin, widely blamed for leading the company to near ruin, was fired.
Mr Hester has said that investors have expressed concerns over RBS's ability to hire and retain top performers and warned that staff who work at the bank have had to deal with the public opprobrium it has faced, although many of those responsible for its problems have been fired.
Mr Myners said imposing a tough bonus clampdown on RBS alone would do little to change global banking behaviour and would severely disadvantage the and the tax-payer's chances of getting a return on the billions invested into it: "The Royal Bank of Scotland cannot redefine the world alone," he said.
RBS has denied its board threatened to step down over the veto issue, but has said it took legal advice on issues related to it and their ability to function as directors as a result.
elephant appealThe first 23 lots in our charity auction have now gone. But there are 22 more still up for grabs
musicPolice chief rejects rappers' claims that his work is as dangerous as law enforcement or military service
comedy'Fresh Meat' star sees off stiff competition from Alan Carr, David Mitchell, Graham Norton, Lee Mack and Sarah Millican to win top prize
healthJames Bond's alcohol consumption puts him at 'high risk' of cirrhosis, tremors... and impotence
French café starts charging extra to rude customers
Mystery of Epping Forest 'big cat' is solved
North Korea: First Kim Jong-un orders execution of uncle - now it emerges that victim's wife was involved in decision to execute him
Australia incest case: Deformed children found in remote farming community after generations of inbreeding
Fox News presenter tells viewers it is a 'fact' that both Jesus and Santa Claus are white
- 1 French café starts charging extra to rude customers
- 2 Italian court annuls prison sentence for elderly paedophile after 11-year-old victim tells investigators in Catanzaro that she loves him
- 3 Australia incest case: Deformed children found in remote farming community after generations of inbreeding
- 4 Physicists discover 'clearest evidence yet' that the Universe is a hologram
- 5 Fox News presenter tells viewers it is a 'fact' that both Jesus and Santa Claus are white
- < Previous
- Next >
iJobs Money & Business
£40000 - £50000 per annum + BONUS + BENEFITS: Harrington Starr: A leading prov...
attractive: Citifocus: Leading Asset Management house, wish to identify a temp...
£200 - £240 per day: Harrington Starr: Client Data Management - City - Brokera...
£44999 - £60001 per annum + Benefits: Pro-Recruitment Group: A Top Tier firm i...