RBS misled us over Sir Fred’s pension deal, ministers claim
Downing Street was today embroiled in a bitter blame game over the "obscene" £693,000 pension for disgraced banker Sir Fred Goodwin.
Lord Myners, the Treasury Minister who failed to stop the massive pay-off, was under increasing fire from Labour MPs, Tories and trade unions.
No 10 hit back this afternoon, suggesting senior figures at the Royal Bank of Scotland misled the minister into thinking the deal could not be blocked.
That was understood to refer to the bank's ex-chairman Sir Tom McKillop, who informed Lord Myners about the size of the pension last October.
According to one account, Sir Tom told him in front of a lawyer that the £16 million pension pot was a contractual obligation.
It is now clear that the bank doubled the pot to allow Sir Fred to retire 10 years early at just 50, meaning he is already pocketing £13,000 every month for doing nothing.
Lord Myners took no action and did not even tell Chancellor Alistair Darling about the looming furore.
At the time the Government was desperate to remove Sir Fred and, MPs are speculating, former businessman Lord Myners lacked the political experience to realise how much outrage the pension would cause. Treasury insiders say the full RBS board was not told it could have refused to pay the full amount.
Lawyers for the Government are now looking into whether the pension could be overturned on the grounds the board was in the dark about the full facts.
Gordon Brown said: "The behaviour in the RBS, where very substantial additional payment awards were given, is something that makes me angry and will make the public angry.
"That is why we are taking all the legal advice necessary to secure the rights of the general public in this and are still asking Sir Fred to waive the pension."
However, pressure on Lord Myners to explain how he missed a chance to block the pension was growing.
Former Cabinet minister Peter Hain said it was "astonishing" that such a massive pay-off went through under ministers' noses.
GMB union leader Paul Kenny, said: "If Lord Myners agreed ... or even worse if he did not check what sort of pension he was going to get, he should go."
Labour MP John McDonnell said the Government was "negligent" if it had failed to "read the small print".
Shadow chancellor George Osborne today said the Government was to blame: "The problem for the Government, and for Lord Myners, is that they knew all along about this pension so all this synthetic anger now is just long after the horse has bolted."
Sir Fred Goodwin to Lord Myners:
"To voluntarily accept a reduction in a pension entitlement which has been built up over many years and in other employments in addition to RBS is not warranted. While I suspect that you will not now agree with it, I hope you can understand my rationale for declining your request to voluntarily reduce my pension entitlement."
Lord Myners to Sir Fred Goodwin:
"I do not agree with your rationale for declining my request that you voluntarily reduce your pension. And indeed I hope that on reflection you will now share my clear view that the losses reported today by the bank which you ran until October cannot justify such a huge award"
