MercoPress. South Atlantic News Agency

“Public opinion” court will not accept UK banker’s pension

No good times for Sir Fred

Sir Fred Goodwin will not get his £650,000-plus pension even if he is legally entitled to it, Commons Leader Harriet Harman vowed in the strongest Government attack yet on the former banking chief.

In what appeared to be a strong hint that the law could even be changed to recoup some of the cash, she warned the ex-Royal Bank of Scotland chief executive should “not be counting” on the money.

“The Prime Minister has said it is not acceptable and therefore it will not be accepted. It might be enforceable in a court of law this contract but it's not enforceable in the court of public opinion and that's where the Government steps in,” Ms Harman told BBC1's Andrew Marr show.

Sir Fred, blamed for leading RBS to near collapse and a taxpayer bail-out, has resisted demands to do the “honourable” thing and give up the lucrative package which he insists was approved by City Minister Lord Myners.

The peer, a former senior City figure who insists he believed Sir Fred was getting only what the bank was legally required to give him when the deal was approved in October, faced mounting pressure himself.

Shadow chancellor George Osborne said the minister's future was “hanging by a thread” and challenged him to either produce a convincing explanation of his role or resign.

Mr Osborne backed the use of “any legal measure” to recoup Sir Fred's pension but accused ministers of acting too late and trying to divert attention from their own responsibility by attacking Sir Fred.

In the strongest attack yet on the ex banking chief, Ms Harman said: “Sir Fred should not be counting on being £650,000 a year better off as a result of this because it is not going to happen.”

As he was only 50 years old, it was hard to see how it could be a pension, she added. “It is money for nothing, it is a severance payment, and to get a severance payment when you have led a bank to the brink of collapse with record losses and thousands of people fearing for their jobs and requiring the public to step in with loans to back up the bank, that is a matter of public interest.”

She declined to say exactly what action could be taken but reports this week have suggested a special Act of Parliament was being considered by Downing Street as a last resort.