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RBS investors angry at new share bonus scheme

Royal Bank of Scotland has today revealed that chief executive Stephen Hester will receive £4.2 million worth of new shares in a new three-year bonus plan aimed at retaining key staff within the company. While the share bonus scheme has caused controversy, coming just days after a further 2,600 job cuts were announced, it is the effective cash-in price which is upsetting investors most.

This scheme will be activated once the share price of Royal Bank of Scotland hits 57.5p, a level which was broken towards the end of last month although the shares have since fallen back to below 50p. The award to Stephen Hester is the equivalent of 350% of his annual salary and is only one of a number of share incentive schemes introduced to key members of staff. It is easy to forget that Royal Bank of Scotland is currently 84% owned by UK taxpayers and without the assistance of UK taxpayers and the UK government would likely have gone out of business.

Finding a balance between rewarding key members of staff and appreciating that UK taxpayers are still struggling in their own right is a very difficult situation to say the least.

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