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| Version 1 | Version 2 |
|---|---|
| Darling faces RBS pension anger | Darling faces RBS pension anger |
| (about 1 hour later) | |
| Chancellor Alistair Darling has admitted the government could have stopped ex-RBS chief Sir Fred Goodwin from getting a £650,000-a-year pension. | |
| But it did not realise this at the time when it agreed to pump £20bn of taxpayers money into the firm. | |
| It thought 50-year-old Sir Fred's early retirement deal was "an unavoidable legal commitment," said Mr Darling. | |
| Shadow Chancellor George Osborne called Mr Darling's "excuse" that he did not know what was happening "pathetic". | Shadow Chancellor George Osborne called Mr Darling's "excuse" that he did not know what was happening "pathetic". |
| He told BBC News "these pensions were awarded on their watch" and Mr Darling's admission showed the government "did not have a grip on events". | He told BBC News "these pensions were awarded on their watch" and Mr Darling's admission showed the government "did not have a grip on events". |
| Speaking earlier in the Commons, Mr Osborne said Sir Fred's pension was "a totally irresponsible use of taxpayer's money" and he demanded to know if the former RBS chief had delayed his departure to negotiation the pension. | |
| "Whichever way one looks at it, this obscene pension is unacceptable and the government is on the hook," Mr Osborne said. | |
| It was only very recently that we became aware that the decision of the previous board of RBS to allow Sir Fred to take early retirement had the effect of increasing his pension entitlement Chancellor Alistair Darling RBS reports record corporate loss | |
| "Either they did know and failed to act, or didn't know and failed to ask the right questions." | |
| Lib Dem Treasury spokesman Vince Cable said he agreed with Mr Osborne, adding: "This is a massive public spending increase, public wages, for which there is no justification whatever." | |
| Mr Darling has appealed to Sir Fred to give up his £650,000 package amid growing cross party anger at rewards for failure. | Mr Darling has appealed to Sir Fred to give up his £650,000 package amid growing cross party anger at rewards for failure. |
| 'Excesses' | 'Excesses' |
| Sir Fred, 50, who helped steer RBS to the brink of ruin, was given a £16m pension pot which he can claim from for life when he took early retirement in October. | Sir Fred, 50, who helped steer RBS to the brink of ruin, was given a £16m pension pot which he can claim from for life when he took early retirement in October. |
| Mr Darling said such "excesses" could not be justified and said that ministers were considering their legal options. | Mr Darling said such "excesses" could not be justified and said that ministers were considering their legal options. |
| He told BBC Radio 4's Today programme: "We've got the lawyers looking at this, but I do think that on a voluntary basis, actually, Sir Fred could resolve this problem and he could do it quite quickly." | He told BBC Radio 4's Today programme: "We've got the lawyers looking at this, but I do think that on a voluntary basis, actually, Sir Fred could resolve this problem and he could do it quite quickly." |
| He told MPs that he had only discovered the size of Sir Fred's pension last week, but was pressed about current RBS chief Stephen Hestor's comment on Today that the pension had been agreed by the bank's old board and the government. | He told MPs that he had only discovered the size of Sir Fred's pension last week, but was pressed about current RBS chief Stephen Hestor's comment on Today that the pension had been agreed by the bank's old board and the government. |
| Mr Darling said the government had believed that the pension agreement was a contractual obligation to Sir Fred. | Mr Darling said the government had believed that the pension agreement was a contractual obligation to Sir Fred. |
| "We had previously understood that his pension commitments were an unavoidable legal commitment," he told MPs during a statement to MPs about new support for Royal Bank of Scotland. | "We had previously understood that his pension commitments were an unavoidable legal commitment," he told MPs during a statement to MPs about new support for Royal Bank of Scotland. |
| "We didn't know and it was only very recently that we became aware that the decision of the previous board of RBS to allow Sir Fred to take early retirement had the effect of increasing his pension entitlement and that might have been a discretionary choice." | "We didn't know and it was only very recently that we became aware that the decision of the previous board of RBS to allow Sir Fred to take early retirement had the effect of increasing his pension entitlement and that might have been a discretionary choice." |
| 'Clawing back' | 'Clawing back' |
| It was "only last week" that it became clear "that this may have been a discretionary choice", said Mr Darling. | It was "only last week" that it became clear "that this may have been a discretionary choice", said Mr Darling. |
| Profile: Sir Fred Goodwin | |
| When he found out, Mr Darling asked UK Financial Investments, which manages the government's 70% stake in RBS, to investigate the possibility of "clawing back" some of the money or "whether the board took the decision in the full knowledge of the facts". | When he found out, Mr Darling asked UK Financial Investments, which manages the government's 70% stake in RBS, to investigate the possibility of "clawing back" some of the money or "whether the board took the decision in the full knowledge of the facts". |
| The investigation was still going on, he told MPs, but he repeated his appeal to Sir Fred to give up his pension, saying: "The ball is in his court". | The investigation was still going on, he told MPs, but he repeated his appeal to Sir Fred to give up his pension, saying: "The ball is in his court". |
| Mr Darling insisted it was the previous RBS board's decision to set Sir Fred's pension, but current RBS chief executive Stephen Hester told Today: "The arrangements for my predecessor's departure were negotiated directly between past directors of this board and the Government and him." | |
| Sir Fred stepped down in October last year as part of the government's rescue of the faltering bank. | Sir Fred stepped down in October last year as part of the government's rescue of the faltering bank. |
| The controversy over his pension intensified as RBS announced that its 2008 loss totalled £24.1bn ($34.2bn) - the biggest annual loss in UK corporate history. | The controversy over his pension intensified as RBS announced that its 2008 loss totalled £24.1bn ($34.2bn) - the biggest annual loss in UK corporate history. |
| Sir Fred's strategy and decision to buy ABN Amro is widely seen as making the bank more vulnerable to the credit crunch and having to be bailed out. | Sir Fred's strategy and decision to buy ABN Amro is widely seen as making the bank more vulnerable to the credit crunch and having to be bailed out. |