Bankers' pay needs to be "corrected" - RBS chairman
Royal Bank of Scotland (RBS) Chairman Sir Philip Hampton rides an escalator before the start of the the company's annual general meeting in Edinburgh, Scotland April 28, 2010.
Credit: Reuters/David Moir
LONDON |
LONDON (Reuters) - Pay in the banking industry has been high for too long and needs to be "corrected," the chairman of state-backed Royal Bank of Scotland told BBC Radio on Friday.
"Pay has been high for too long ... particularly in the banks, particularly in the investment banks, shareholders have done pretty badly and employees have done pretty well certainly over the last 10 years," said RBS Chairman Philip Hampton.
"That needs to be corrected. It actually isn't a society or fairness issue, it's a straightforward business issue. Too much of the money has not been going to the right place," he added.
Last month, Hampton and RBS Chief Executive Stephen Hester gave up their million pound bonus packages following intense public anger over the awards, with politicians from all major parties calling on them to decline the payments.
Hampton said RBS had underestimated the scale of the public outcry over the bonuses, but added that, compared to many other banks and businesses, salaries at RBS were not that high in relative terms.
RBS is 83-percent owned by the government after a taxpayer backed bailout during the 2008 credit crisis.
Hampton also denied media reports that the RBS board had threatened to resign as a result of the bonus payment row.
"That threat was never raised," he said.
(Reporting by Sudip Kar-Gupta; Editing by Michael Holden)
- Tweet this
- Link this
- Share this
- Digg this
- Reprints
However, this is not a problem restricted to the banking sector alone. It is widespread across the corporate industry. This will continue to be the case since the average person is forced by government to invest in pension funds who remove the decision making vote.
The public vote against excessive pay awards is 85% (according to recent polls), yet the actual vote from the remuneration committees do not reflect this.
The system is broken: The shareholders vote (the person in the street who has deposited money with a pension fund or other manager) does not pass through the system correctly. Until this is fixed, excessive pay will continue !
It will be a long time (approximately 10 years) until this is fixed, if at all because of government. Until that time, i intend to make use of this and take even more unjustified money from the weak and needy. Sorry !!!
Follow Reuters