Chuka Umunna MP, Labour’s Shadow Business Secretary, commenting on Stephen Hester’s bonus, said:
“Ministers have spoken of the need for greater shareholder activism but despite the Government being the largest shareholder in RBS, have failed to rein in excess. People will not be able to understand why, at a time when they are facing the biggest squeeze on their incomes in a generation, the Prime Minister has failed to act despite his promises to do so.
"The Deputy Prime Minister, Prime Minister and others have tried to suggest that the bonus framework was set by the last Labour government which is simply untrue. RBS has been very clear that the remuneration committee of the board of the bank had discretion in this case.
“Because his bonus is being paid in shares, Mr Hester could end up receiving well over £1 million. Given that the Chancellor promised a year ago that bank chief executive pay would be linked to SME lending, news of Mr Hester’s bonus is a slap in the face for thousands of small businesses struggling to get the finance they need. RBS missed its lending target in the third quarter of last year and net lending to businesses by the country’s banks fell in nine out of the last 12 months.”
"This issue has now gone beyond Stephen Hester, this is about a Prime Minister who promised to rein in excess and says to the country in a time of austerity, when his economic policies have choked off growth, that we are all in it together - how hollow is his rhetoric in light of what we have just seen today.
“If David Cameron thinks it is acceptable for Mr Hester to receive this vast bonus then he is not just out of touch with most people in Britain, he is living on a different planet.”
Lord Paul Myners, former Financial Services Secretary, said:
“There is nothing in the employment contract of Stephen Hester or any director of Royal Bank of Scotland which binds the company or its remuneration committee to pay a mandatory bonus. All matters relating to bonuses are at the full discretion of the board of directors and the shareholders, including UKFI, who have elected them.”