Traders and junior executives in line for bonuses at Royal Bank of Scotland
Gordon Brown this evening seems to have fallen into a trap which many opposition parties had hoped would catch him out. While he has expressed his support for US President Barak Obama's move for restraint on pay and bonuses in the US banking sector he is refusing to block bonuses to traders and junior executives at Royal Bank of Scotland.
While directors of government controlled banking groups have agreed that they will show restraint in bonuses for board directors it would appear that this directive does not apply to junior executives and traders. In effect it looks as though the Royal Bank of Scotland could be paying out substantial bonuses at a time when the company is reporting record losses and has just been bailed out up by the taxpayer. Currently the taxpayer has a 70% stake in the business and is effectively in control and supporting the bank on a financial base.
Taxpayers across the UK will be dismayed to learn that their funding will be flowing out of the business and straight into the pockets of junior executives and traders at a time when many companies across the UK are struggling. Quite how Gordon Brown will be able to justify this against his support for Barack Obama remains to be seen.
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