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Sir Fred Goodwin to hand back £4m of pension pot
Jonathan Prynn and Peter Allen18 Jun 2009
Disgraced banking boss Sir Fred Goodwin has agreed to hand back around £4 million of his pension pot so he can get another job.
The former Royal Bank of Scotland chief executive - currently in self-imposed “exile” in a south of France hideaway - has offered a “significant concession” to end his pariah status, according to industry sources.
The banker known as “Fred the Shred” will take a £200,000 a year cut in his pension - equivalent to a £4 million reduction in the size of his company pension fund.
It emerged in February that Sir Fred was entitled to a retirement income for life of £703,000 despite the near collapse of Royal Bank of Scotland, record losses of £24.1 billion and £20 billion of taxpayer support to prop it up.
This was reduced to around £550,000 after he decided to take a £2.7 million tax free lump-sum. The new deal will still leave him on a £350,000 a year income.
There was no official confirmation from Royal Bank of Scotland but a source said chairman Sir Philip Hampton had been in discussions with Sir Fred for months. “It looks like Fred has done the right thing,” said the source.
Chancellor Alistair Darling said: "I'm very glad that RBS have now resolved the matter with Sir Fred Goodwin. Sir Fred, in handing back part of his pension, is doing the right thing."
Mr Darling, who was speaking during a visit to Sheffield, said: "What I want to do now is to make sure that we rebuild RBS and all its banking operations, that's absolutely essential, not just for the bank but for the thousands and thousands of people who work for that bank and for the economy as a whole."
Soon after news of the enormous pension was made public credit crunch activists attacked Sir Fred's £2 million family house in Edinburgh.
They smashed three windows and damaged his Mercedes, forcing Sir Fred and his wife Joyce to take their two children out of school and flee to France.
Now they are based in a palatial rented villa near Canneswhich is guarded round-the-clock by security staff and Rottweiler dogs.
One industry source said: "Fred is sick of living his life like a pariah and wants to get home, possibly with a view to working in the banking sector again," said an industry source.
"There's only so much time you can spend sitting around in the French sunshine, and Fred believes that a concession in his pension benefits will win back public confidence. He feels he's been punished enough and wants to hold his head up high back in Britain. Lawyers are fine tuning a deal."
He feels he's been punished enough and wants to hold his head up high back in Britain. Lawyers are fine tuning a deal.
His wife Joyce, 49, and two children, have been enjoying visits to the beach, local golf courses, shopping centres and upmarket restaurants in France.
"They are very happy here, and never get disturbed," said a neighbour. Friends and other family members have also been regular visitors, including Sir Fred's parents-in-law Norman and Nessie McLean.
The pair are regular visitors to local shopping arcades, golf clubs, spas and upmarket restaurants. They are seen in a Mercedes E320 convertible.
The Goodwin's home is being rented through a family called the Morrisons, who are friends of Sir Fred from his banking days.
Sir Fraser Morrison and his wife Patricia own a string of companies in the UK, including Teasses Estate in Fife that offers high-society pheasant shooting trips -a favourite pastime of Sir Fred.
Sir Fred announced his resignation as RBS chief executive on October 11 last year, a month before the bank revealed its record losses.
The government had to put in £20 billion of taxpayers' money to keep it operating-and also insure a staggering £325billion in toxic assets so the bank could lift itself out of difficulty.
So far this year, more than 15,000 jobs have been axed in a desperate bid by the bank to cut costs.
Sir Fred's huge pension deal was not revealed until February this year amid widespread public condemnation.
Prime Minister Gordon Brown said a very substantial part of it should be returned', while former Deputy PM John Prescott called for it to be withdrawn completely.
Reader views (40)
Where did he invest his pension plan? Not in RBS I assume. How can anyone think of giving him a job in banking again? what's his CV going to say - Ex CEO of RBS, a company I drove in the ground and which lost tens of billions of pounds and had to be proppped up by taxpayers. It seems once you get to the top you don't actually have to do anything positive at all to earn millions.
- Mr Opinion, London Village, 19/06/2009 13:48
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Investment Banker, London
To echo your point, what are the shareholders of British Airways doing other than giving licence to Willie Walsh, a CEO who has never grown a thing in his life, to ruin the once excellent flagship airline ?
It seems to me that across industries, shareholders are turning a blind eye to the wholesale destruction by the beancounters which is worsening the downturn rather than preparing for recovery from it.
Fred Goodwin is merely symptomatic of that
- John, Twickenham, 19/06/2009 07:47
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Too right said Fred !! Unfortunately too little, too late Mr Flinstone...
- Martin, New York, USA, 19/06/2009 07:11
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I recall anecdotal accounts of Sir Fred Goodwin's arrogant use of RBS funds for furnishing his private office, and his insistence on private jet trips. With CEO power comes ultimate responsibility, and accountability. Given his significant contribution, via imprudent risk management, to the current & future burden on the UK taxpayer, through the enforced rescue of RBS via both capital injections and asset guarantees, Sir Fred's "sacrificial" return of 25% of his pension pot seems inadequate, particularly as it has coincided with the threat of legal action against him.
It is unclear whether all RBS' losses via toxic assets have yet been identified & declared - in the stricter regulatory framework now envisaged, which financial sector entity would be wise to hire him? (and just who is floating this disreputable idea?)
Sir Fred should be grateful that there was high level connivance in allowing him to "retire", when in reality he should have been sacked - and, of course, this says nothing about the high-level cronies at RBS who pushed this pension plan through while the Authorities were distracted with the enormity of the near disaster to the UK economy.
- Pat S, London England, 19/06/2009 03:31
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It shows just how much out of touch Goodwin is with the feelings of the public if he believes that his modest concession, given after so many months, and after it has had to be dragged out of him, will be seen as adequate contrition. It's hardly sackcloth and ashes. He should stay in the S of F, amongst the other tax exiles.
- Robert N, London, 18/06/2009 23:03
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No one deserves to be thrown on the scrap heap at 50 with just a lousy 500k a year to show for it. I hope Sir Fred finds another job, but I do feel he might need some specialist help with the accomplishments section of his c.v.
- Noel, Swindon, 18/06/2009 22:17
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all things being equal and in a world where merit, trust, justice and moral rectitude counted for something, himself, other me first bankers, politicos, councillors and other social outcasts of similier ilk would never be trusted to get a grandmother's shopping,
but given the entire 'elite' were as corrupt, greedy and morally defective as each other they'll always be jobs for the old boys and bandits alike.
- M.O'Brien, london.uk, 18/06/2009 20:16
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I guess it's proof that even though his neck is made of brass, he might be human underneath. Far too late to salvage any sort of career, though!
- Nigel, London, 18/06/2009 18:04
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There is work for every ex-banker; most will make very good loan-sharks.
- Mickyinlondon, london, 18/06/2009 17:55
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Is this a sham or a scam?
- Peter Seekings-Foster, Mildenhall, Suffolk., 18/06/2009 17:48
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For god sake jail him, he's just a crook
- C Cusano, Bedford, 18/06/2009 16:49
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All previous posters are (sadly)both misguided and unjust. There is an obvious job for him - the "independent" regulator of MP's expenses. Eminently qualified.
- Jb, London, 18/06/2009 16:36
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"possibly with a view to working in the banking sector again" - any bank taking on this toxic fellow better get shareholder approval beforehand! His record on creating value is blown to smithereens.
- Keith, Bath, 18/06/2009 16:07
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What a pathetic little man. So not satisfied with his last job on the Uk Taxpayer he wants to have another go at it and this time REALLY FINISH THE JOB ON US ALL !
- A.Txpayer, london, 18/06/2009 16:00
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Good idea to put him in the Cabinet. Lord Shred plus Lord Apprentice, Lord Ian Clements and Lord Boris Johnson. Gordon, why not add their dinner guest Lord Cockell while you are at it?
- Richard, London, 18/06/2009 15:43
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When is he handing back the ridiculous title 'Sir'?
And the other £20 billion lost during his leadership?
He is now getting the pension he expected before the other corrupt directors gave him taxpayers money - no hardship there,
- Milou, London, 18/06/2009 15:18
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'"Fred is sick of living his life like a pariah and ..'
Ronnie Biggs had to make a few sacrifices too, but don't worry Fred, you'll end up on the public purse again just like him, I'm sure.
- Mdj E10, london uk, 18/06/2009 14:34
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I don't believe in lynch mobs or witch hunts but I do think that in some senses "Sir" Fred should be and remain a pariah. The "court of public opinion" should prevent him from settling back in UK or taking another managerial job of any kind. it will probably be impossible to remove his riches but he should at least live with public disdain. If not, a silent message is being sent that ridiculously greedy behaviour and shameless risk taking are all right really and get rewarded in the end.
- Mary, london, 18/06/2009 14:07
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That's good of him. It shouldn't have been his choice.
- Hb, rochford, essex, 18/06/2009 13:53
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Just keep him out of Banking; us tax payers can't afford him or his kind ever again.
- Mickyinlondon, london, 18/06/2009 13:52
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"Fred is sick of living his life like a pariah and wants to get home, possibly with a view to working in the banking sector again.....and Fred believes that a concession in his pension benefits will win back public confidence. He feels he's been punished enough and wants to hold his head up high back in Britain,"
ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha ha!!! Just goes to show how out of touch with reality this man really is...
Please reassure me that no company is stupid enough to give him a job....
- Madge Fan, London, 18/06/2009 13:50
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Will Gordon Brown now give up his bloated pension after presiding over a much bigger financial catastrophe than Fred Goodwin?
- Richard Munton, Kent England, 18/06/2009 13:49
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Gordon Brown will no doubt offer him a peerage and appoint him to the cabinet. He has all the necessary attributes - he is ruthless, a cheat, and a looser so he should feel very much at home amongst all the other crooks in the cabinet.
- R.F., Yorks, UK, 18/06/2009 13:33
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..so he can get another job. Is he kidding? I can just imagine the shortlisting panel - "some really good candidates here, hang on! here's one from the guy who destroyed the Bank of Scotland. Oooh, we MUST have him!"
- Charlie, London, 18/06/2009 13:17
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4 000 000 to be given back.For the rich in these jobs it must be like winning the lotto.There is something wrong with society as a whole when one man can give back that amount of money whilst the average pensioner lives in poverty.The world needs to change,the greed of the rich here in the UK needs to be eliminated and the working class who generate the wealth of the country need to start to benefit from their efforts.
- David, london, 18/06/2009 13:11
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I think the Taxpayer would much prefer he keep his pension. What's wrong with France? His family are "very happy there". If he wants to return to work, he should take his place in the queue behind all of the other RBS employees who would like to do the same. At least he should have the tact to wait until RBS has repaid all of its bail-out. This will probably take no more than 10-15 years, maybe less. What's the rush? Please, we cannot AFFORD him back.
- Bloke, London, 18/06/2009 13:06
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"THROW HIM IN PRISON - ALONG WITH ALL THE FIDDLING MP's."
Unlike the situation with one or two MPs, there's no evidence that he's done anything illegal. Morally questionable, certainly, but everything was agreed upfront and signed by every relevant party. So what charges would you be bringing?
- Michael, London, 18/06/2009 13:04
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This man is nothing but a complete charlatan. If the Government has any sense, it will continue to go after him and not settle at this - not only is this the proper thing to do - its the populist thing to do. People like this need to be brought to account.
- James, london, 18/06/2009 12:55
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HE SHOULD RECEIVE A KNIGHTHOOD OR ONE OF THOSE CASH FOR HONOURS, THE MAN HAS OPENED EVERYONES EYES UP TO THE AMOUNT OF FRAUD DECEIT THAT WAS ALL KEPT HIDDEN FROM US THE LABOUR GOVERNMENT NEW ALL THIS AND DONE NOTHING THEY LET SLEEPING DOGS LIE, SERIOUSLY HE SHOULD BE STRUNG UP ALONG WITH ALL HIS CRONIES,ANOTHER NATIONAL EMBARRASSMENT,
- James Fennessey, london, 18/06/2009 12:51
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Why should he? It was the stupid shareholders that approved his package. About time they learned a lesson on boardroom pay. These people rarely give real added value yet the funds and other major shareholders still let the senior management give themselves ridiculously generous packages. BGI anyone?
- Investment Banker, London, 18/06/2009 12:45
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I don't think that he should be forced to give it back. The average person in the street has greatly benefited from the rise in the value of their homes, interest rates are at historicall low levels and unemployment in the UK is about 7%. The fact remains that it was only by expansion in banking markets that the housing market has gone up, through derivatives of a sort and the average person in the street has now more disposable income, unless of course they are in debt, that's not Sir Fred's fault..really wise up
- Michael, Switzerland, 18/06/2009 12:40
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STRIP FRED THE SHRED OF ALL HIS ASSETS.
THROW HIM IN PRISON - ALONG WITH ALL THE FIDDLING MP's.
- Reuben Camara, Morecambe UK, 18/06/2009 12:30
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He's obviously terrified of any legal action. Take him to court.
- Alex C, London, 18/06/2009 12:06
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he should be sent to prison and stripped of his assets - the money he has lost, the misery he has caused... - and why are people still calling him 'Sir'? Go on Gordon, do something right for once get Goodwin into a court to answer to charges of causing misery to millions through sheer arrogance, greed and negligence.
- Mc, London, 18/06/2009 12:05
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Fred, don't hand it back to the government or the MPs will have it as their expenses. Give it direct to the NHS!
- Sue, Orpington, Kent, 18/06/2009 12:01
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Feeling guilty are we fred.
- Martin, Sheffield, 18/06/2009 11:54
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Whoopee...that's big of him!! Why doesn't he try giving back 90% of his pension instead? That would help assuage the purses of the employees that actually lost their jobs because of his bad management. ALSO - I doubt he's giving back this money willingly either considering that it's actually taken him this long to grow a conscience!!!
- Ali Sichilongo, London, 18/06/2009 11:50
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Hallo, hallo, hallo! I wonder what pressure was brought to bear to wring this concession from Sir Fred?
- Graham Rodhouse, Helmond, Netherlands, 18/06/2009 11:45
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What took him so long......
- Chris H, City, 18/06/2009 11:41
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I am terribly concenred for Fred, do you think he will be able to manage of just half a million a year?
- Mark Russell, Poitiers, France, 18/06/2009 11:34
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