Welcome to the new Independent website. We hope you enjoy it and we value your feedback. Please contact us here.

UK Politics

Minister's £100,000 'pension link' to RBS

MPs want to question Lord Myners over his director's pension from NatWest

Lord Myners, the minister at the heart of the row over the £703,000-a-year pension enjoyed by the former Royal Bank of Scotland (RBS) boss Sir Fred Goodwin, is drawing an annual pension of almost £100,000 from a company that is linked to a subsidiary of the troubled bank.

MPs on the Commons Treasury Select Committee want to question the City minister about his personal knowledge of the RBS pension scheme and his own pension from his time as a director of NatWest, which RBS bought in 2000.

The NatWest Group's annual report for 1999 shows that Lord Myners would be entitled to a £99,800-a-year-pension upon reaching 60 – his current age.

His allies said last night the pension was from the fund managers Gartmore, where Lord Myners worked for 16 years and was chief executive. NatWest bought Gartmore in 1996 but RBS sold it soon after it acquired NatWest.

Aides of the minister, who was heavily involved in the Government's decision to inject £33bn into RBS, insisted that there was no conflict of interest because his pension from Gartmore had "no link whatsoever" with his role in the bank rescue or the controversy over Sir Fred's pension.

His link with Gartmore – but not with NatWest – is mentioned in Lord Myners' entry in the House of Lords register of interests. It lists his "benefits consequent to past employment by NM Rothschild and Sons Ltd, Gartmore and Marks & Spencer" but does not disclose how much he receives.

The former chairman of the Low Pay Commission is an ally of Gordon Brown, who persuaded him to join his Government last October. He does not draw a ministerial salary.

Alistair Darling, the Chancellor, has agreed to be questioned by the Treasury Committee on 19 March as part of its investigation into the banking crisis. But Tory members of the committee suspect that Mr Darling is trying to shield Lord Myners. As well as wanting to ask him about his own links with NatWest, they intend to press him about what he knew about the controversial pension that was handed to Sir Fred, the former chief executive blamed for the virtual collapse of RBS.

Lord Myners insists he was not told the scale of Sir Fred's pension last October, when the RBS boss stood down as part of the Government's bailout, and did not approve the payment. But RBS claims it told Lord Myners that Sir Fred's pension pot was worth between £15m and £20m.

Treasury sources say that no decision has been made on whether Lord Myners will appear before the committee. A Treasury spokesman said last night: "It would not be appropriate for the Treasury to comment on a minister's personal financial interests."

Lord Myners lost his boardroom job at NatWest after the bank lost its fight to remain independent in 2000. Sir Fred was widely seen as the victor in a bidding war for NatWest and won promotion to the chief executive role.

When he was embroiled in negotiations with the Government over last autumn's bailout of RBS, he described his talks with Lord Myners as more like a "drive-by shooting".

After leaving NatWest, Lord Myners built a successful career for himself with a series of non-executive directorships. He stood down as the chairman of the Guardian Media Group to join the Government.

In an interview in January, he called on banking boards and shareholders to crack down on the reckless behaviour of those in management, saying that if people had committed crimes they should be prosecuted.

"I have met more masters of the universe than I would like to, people who were grossly over-rewarded and did not recognise that. Some of that is pretty unpalatable," he said.

"They are people who have no sense of the broader society around them. There is quite a lot of annoyance and much of that is justified. Let us be quite clear: there has been mismanagement of our banks."