Sunday, 8 November 2009


Gogarburn: Head office of RBS

I listened to an interview with the chief executive of RBS, on the Today Programme the other day, as a further £25 billion of our tax pounds was deposited in it.

It was literally unbelievable. I was pinching myself to make sure I wasn’t still dreaming. The need for the bonuses was an absolute, according to Mr Hester, despite that fact that they are being paid by our taxes; taxes of people who earn a tiny fraction of what the bonus is, to people who are effectively civil servants and not very good ones at that. “We have to pay competitive bonuses or they will go elsewhere “, he whined, over and over.

There was no question of negotiation; no humility about the fact that we are paying bonuses to executives of a bank which has lost so much money, and continues to lose so much money that most ordinary people can't begin to comprehend the figures. They mean nothing to us.

It was Alice in Wonderland stuff from a bank that made the biggest loss in history. “We have to keep our good people.”

WHAT BLOODY GOOD PEOPLE? I was shouting at the radio. The ones that lost so much money that no one in the world knows how much it will come to in the end? Those good people?

At the same time I read about the reduction in the Scottish block grant of around £3 billion over three years. The cutting of expenditure in Scotland, is a tiny fraction of the money being poured into RBS, and, along with a downward spiral of unemployment, more poverty, and more unemployment, it will cause untold grief to some of the most vulnerable people in Scotland.

Old people's care doesn't just employ carers, it cares for old people. Old people will have to be kept in hospital, and take up beds sick people might have used. Free school meals don't just employ dinner ladies; they may be the only meals that some poor hungry kids get.

Reduced price prescriptions have meant that more people, handed a script with 3 or 4 medicines on, may not have had to choose which ones they can afford.

Untold misery will come from these decisions.

But we can't have bankers going without their Porches, can we? Apparently not.

I wonder if this reduction in spending isn't some sort of punishment to the Scottish people for voting SNP and for continuing to think that they are doing a good job.

Is this Brown's way of saying ... this is what you get if you don't vote Labour?

In the amount of money that they are chucking at banks, three billion is such a tiny sum that no one would notice it. But we should have known. It was a mistake to humiliate Gordon Brown, and now we must pay.


  1. I'm sick of that argument supporting the bonus culture. Bonuses don't improve performance - they make it worse. This has been known for years yet nobody challenges these bas ... bankers.

  2. Good video scunnert. I've commented over on your blog. I was particularly intrigued by his maxim that there's a "mismatch between what science knows and what business does". (If you replace 'business' with 'government' it becomes clear.)

    The whole thing was well presented and I can certainly identify with his conclusions.

    As to how it will affect the bankers? Well, I would have thought that the government should be telling Mr Hester on our behalf to let the greedy bankers go, and try incentivising the rest of them with personal satisfaction in a 21st century way.

    To be fair to the normally vacucous Mr Cameron, he did talk about that kind of thing a year or so ago, but it never came to anything. I'm sure the 'men in grey suits' kicked it out of touch.

    Thanks for the link. It's worth the 18 or so minutes watching.

  3. I listened to that broadcast poor old Evan was gobsmacked Hester just would not admit to shares being the same as cash.......

    they will not stop they will never ever! ever! stop! stealing and why should they not one has been charged with any wrongdoing.

    and not one political party has asked for them to be punished either

  4. Yes Niko, and Evan knows his stuff when it comes to economics.

    You're right too about the fact that they have thrown the world into a complete meltdown and no one has said sorry, no one has asked for heads, and everyone seems to be demanding that these people be given big bonuses to go and do the whole stupid thing again.

    Alice in Wonderland as I said.

  5. EUOBSERVER / BRUSSELS – The vast majority of experts advising the European Commission on greater financial regulation are drawn from the same institutions that helped cause the crisis, claims a new report published on Thursday (5 November).

    The document, A captive Commission - the role of the financial industry in shaping EU regulation, accuses the EU executive of listening almost exclusively to the finance industry both before and after the onset of the financial crisis over a year ago.

  6. The incredibly stupid thing is that no one, except the people who caused the car crash, understand how any of it works. If you ask any of the old boys in pin stripes in the boardroom of any of the banks, they will shake their heads in wonderment. They didn't have a clue about any of it, but boy was it bringing in the dosh....

    The irony is that it's probably only the greedy thieving ******s that set up the mess, who will be able to unravel any of it... and even that seems unlikely as most of THEM didn't even understand it.

    I blame the people at the very top. The young bloods were stupid and irreponsible but the people at the top should have known better.

  7. Tris..

    Stop your moaning, its only £25 billion. No I'm only kidding..

    It's all very well the Gov pouring more money into RBS and through time they will recuperate the money back but personally I would tell the bank to go take a hike.

    The Gov should say to RBS, if you cant sustain yourself then the profitable parts will be sold off to competitors and your toxic assets will be sold to the highest bidder through Gov bonds on debt. People do make money from debt.

    I worked part time in RBS for just over 2 years and I ken most people in that building and in the Gyle do deserve bonuses for the work they do but not when the bank is failing.

    When I last worked for them the bank made a profit of £8 billion, 4 times the profit of Tesco plc. Every member of staff received a performance bonus and some of us were awarded a further bonus (Share in success) which you put summit like £5 a month into and if the bank does well then your £5 becomes £20.

    All that has to stop now and I ken its hard for staff to appreciate this but they have to learn that they are working for a non profitable company that is on life support. If they don't like it then they can leave because I cant think of too many other bank in Edinburgh that are not feeling the pinch.

    The moto(One team, the RBS team) well true true so now they should act like one team and boot the bonus away for the good of the company.

  8. Oh. That's it Spookie. Problem soved.

    When you were there it made a profit, and then you left and the whole thing went whatsits up!!! LOL. Tell Alistair Darling. I've solved the financial crisis.... he he he...

    Spooks, seriously, I'm not talking about the bonuses of the, if you'll pardon me, ordinary people. Although I can't see why we should pay bonuses to anyone in an organisation where there is a massive loss.... It's just not the way that these things work...

    I was really talking about people who are expecting, no demanding, bonuses of hundreds of thousands, or they will quit and go work for a bank in New York or someplace in India, or Hong Kong. Well to them I say, bye bye, don't let the door hit you in the arse on the way out.

    He he... was that relly the motto....? oh dear, pity they never even thought about living that motto, paying some people £20,000 and others like Freddy in millions. One team, my butt.

    You're much better out of there Spook.

  9. This blog bears a remarkable similarity to Iain McWhiter's on the same topic...

  10. Bucket:

    This article was inspired by my outrage having read Iain's blog. The thoughts in it are my own however.

    I'm sure you would regognise the incredibly inferior writing style, compared with Iain's. :-)

  11. Tris..

    I agree and even if the person is on say £16,000 then yes his/her bonus should be stopped because they are working for a bank that is on life support.

    I don't mind my tax paying money going towards bonuses for people in pubic places of work if they are producing results but RBS is not.

    The good times in that place have gone.

    BTW it was rather Spooky that I left and then the bank went belly up, I'm not surprised though!!

  12. No Spooky... I think we were all expecting it. We're just surprised that it took so long!!! :-)

    I agree that there is no place for bonuses in companies who are making no profit, even for people at the bottom on bread line wages. There is no place for bonuses in banks who are paying off thousands of other people.

    Those on £16,000, which I admit is barely enough to live on, are still very much better off than the people who have been put on the dole by the stupidity of the banks' managements and the government. £60 a week is around £3,000 a year and how people live on that I haven't a clue.

    I really don't know when the people at the top will, if ever, get it into their heads that this can't go on.

    British people are slow to take to the street, but you can only push so far.