Treasury committee grows bad-tempered

By staff

MPs hit out at representatives of the body charged with overseeing government holdings in banks, with claims the organisation would never be taken seriously.

Representatives of UK Financial Investments Limited (UKFI) faced a brutal serious of hostile questions by the Treasury select committee, with John Kingman, chief executive and civil servant on secondment from the Treasury, failuring to provide information on bonuses.

Committee chairman John McFall hit out at Mr Kingman for not providing data on bank bonuses over £100,000 and £1 million despite being called on Friday and asked to provide it.

“Mr Kingman, are you going to be a serious body here?” Mr McFall said.

“You got a simple request on Friday and you don’t seem to apologies.”

He added Mr Kingman was being smug and highly discourteous to the committee.

“The clerk tells me you were phoned,” Mr McFall said

“That is scandalous and a bad start for UKFI. If you are serious body looking after taxpayer money, you have to be serious. We are appalled.”

Glenn Moreno, UKFI chairman and chairman of Financial Times publisher Pearson, stepped in to aid Mr Pearson, stating while banks have announced bonus budgets, they will not have decided how much specific workers will receive.

Mr Kingman was later accused of being “demob happy”, working in his new role outside the Treasury – a claim he denied.

Turning to the issue of the pension for former Royal Bank of Scotland chief executive Sir Fred Goodwin, Mr Kingman stated UKFI was taking legal advice, and any action would be “weeks, not days” away.

He added the decision not to sack Sir Fred Goodwin but allow him to retire early – and so qualify for a higher pension pot – was made solely by Royal Bank of Scotland and not the Treasury, which he was working for at the time.

In particular he highlighted Key decisionmakers Bob Scott, RBS senior remuneration director and former RBS chairman Sir Tom McKillop, as being behind the move, and not City minister Lord Myners.

It emerged today Sir Fred is recieving £703,000 pension a year, somewhat higher than previously reported.

Mr Moreno said: I regard [Sir Fred’s pension] as reward for failure. It was wrong.

“The remuneration committee or board should not have affectively doubled his pension.”

He also hit out at RBS for making “no attempt to make this clear. Neither pointed out significant change was made.”

Mr Moreno added governance of banks was a massive issue and “caused a body blow to the economy.”

Mr Kingman also maintained that the best role for UKFI was not to run the banks, but look after the state’s holding of bank shares.

“The best way to get banks on their feet was commercially and for boards to run banks,” he said.

“Our role is to manage shareholding, and have all the dialogue [with banks]. If we were running we would not have the quick exit the government wants.

“One of lessons learnt was the remunerations were wrong and as shareholder we care about that.”