Woolwich close to pension deal with ex-chief Robinson

Peter Robinson, the former Woolwich chief executive dramatically ousted from his post two months ago, is on the verge of clinching a compensation package with the building society that could allow him to immediately draw an annual pension of pounds 165,000.

Alternatively, under current tax laws Mr Robinson could opt to receive a tax-free lump sum of up to pounds 370,000, plus a reduced annual pension of pounds 135,000 a year.

In return, he will abandon a compensation claim based on the two-year notice period to which he would have been entitled to as part of his contract of service.

Linklaters and Paines, solicitors acting for Woolwich, are believed to be on the verge of agreeing that Mr Robinson, aged 54, be allowed his pension without any penalties for early retirement. His normal retirement age would be 62. If a penalty were to apply, his payout could be cut by up to one-third.

The Woolwich pension scheme is based on one sixtieth of salary for every year of service. Mr Robinson, who served almost 33 years with the society, would be entitled to more than half the pounds 300,000 he earned before his sudden departure in the wake of allegations of financial irregularities.The deal, agreed in outline with Mr Robinson's solicitors D J Freeman, must be accepted by the Woolwich board, which is yet to meet to consider the proposals.

It is believed, however, that some last-minute technicalities are unresolved. Once they are, both he and the building society are expected to announce next month they have reached an agreement.

Woolwich is currently under intense takeover speculation ahead of its pounds 3bn flotation, planned for mid-1997. Among those tipped as potential predators are Prudential, the UK's largest insurer, and BAT, the tobacco giant which also owns Allied Dunbar and Eagle Star.

The society has still to appoint a permanent chief executive to replace Mr Robinson. The post is currently being filled by his predecessor Donald Kirkham, who stepped in at the society's request in early April.

The most recent suggested replacement is Andrew Longhurst, chief executive at Cheltenham & Gloucester, the former building society now owned by Lloyds Bank. Mr Longhurst is said to be unhappy at not being offered a seat on the Lloyds board.

A Woolwich spokesman said: "We have always said that any appointment was weeks rather than months away. We are talking to a number of people."

Mr Robinson's departure followed allegations of improper use of company resources. It was alleged that he had used society gardeners to carry out work on the grounds of his pounds 450,000 home in Kent.

Sources at the Woolwich also claimed that Mr Robinson had wrongly authorised the use of a Range Rover for a member of his family and that unpaid decorating work had been carried out inside his house.

However, Mr Robinson strongly denied all the accusations, claiming that he was the victim of a smear campaign against him by disgruntled Woolwich employees who did not like his management style.