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RBS chairman rejects £1.4m bonus RBS chairman rejects £1.4m bonus
(about 1 hour later)
  
Royal Bank of Scotland chairman Sir Philip Hampton has given up a £1.4m shares reward he was due next month, the BBC has learnt. Royal Bank of Scotland chairman Sir Philip Hampton has given up a £1.4m shares reward he was due next month.
Sir Philip told the bank's remuneration committee it would not be appropriate to receive the 5.17 million shares, says the BBC's Robert Peston.Sir Philip told the bank's remuneration committee it would not be appropriate to receive the 5.17 million shares, says the BBC's Robert Peston.
Meanwhile, the government has ruled out blocking a £963,000 bonus, also in shares, for RBS chief Stephen Hester. Meanwhile, the government has decided to rule out blocking a £963,000 bonus, also in shares, for RBS chief Stephen Hester.
Prime Minister David Cameron said: "That's a matter for him."Prime Minister David Cameron said: "That's a matter for him."
Mr Hester's contract at RBS was agreed by the last Labour government, Mr Cameron said.Mr Hester's contract at RBS was agreed by the last Labour government, Mr Cameron said.
"The alternatives to what's happening now could be even more expensive. If you had a whole new team coming into RBS."The alternatives to what's happening now could be even more expensive. If you had a whole new team coming into RBS.
"We need this team to get on with the job, of turning the bank around, making it safe and securing for the British taxpayer - getting back - all the money that was put into RBS.""We need this team to get on with the job, of turning the bank around, making it safe and securing for the British taxpayer - getting back - all the money that was put into RBS."
There has been no official comment from RBS - which is 82% publicly owned - about Sir Philip's decision.There has been no official comment from RBS - which is 82% publicly owned - about Sir Philip's decision.
But sources have told the BBC his bonus was agreed three years ago when he became chairman in recognition for the scale of the task of turning around the bank.But sources have told the BBC his bonus was agreed three years ago when he became chairman in recognition for the scale of the task of turning around the bank.
The additional reward for Sir Philip was always something slightly unusual, which - as it happens - he didn't request when he took the job three years ago.The additional reward for Sir Philip was always something slightly unusual, which - as it happens - he didn't request when he took the job three years ago.
This shares incentive had already been agreed in negotiations with another candidate to chair RBS.This shares incentive had already been agreed in negotiations with another candidate to chair RBS.
The BBC's Robert Peston said Sir Philip made his decision before the uproar over Mr Hester's payment, which is still drawing criticism.The BBC's Robert Peston said Sir Philip made his decision before the uproar over Mr Hester's payment, which is still drawing criticism.
In a written statement released earlier on Saturday, Labour leader Ed Miliband said: "Rather than defend his decision to nod through a one million pound bonus for Stephen Hester, the prime minister has gone to ground. In a written statement released earlier on Saturday, Labour leader Ed Miliband said: "Rather than defend his decision to nod through a £1 million bonus for Stephen Hester, the prime minister has gone to ground.
"Freezing the pay of a nurse or hospital porter, while allowing a publicly owned bank to pay million pound bonuses, is the last nail in the coffin of this prime minister's claim that we're all in it together. "Freezing the pay of a nurse or hospital porter, while allowing a publicly-owned bank to pay million pound bonuses, is the last nail in the coffin of this prime minister's claim that we're all in it together.
"Having spent weeks boasting he would block bonuses, David Cameron refuses to even publicly explain why he has changed his mind."Having spent weeks boasting he would block bonuses, David Cameron refuses to even publicly explain why he has changed his mind.
"My message to him is: You've got another chance. At the AGM in April the government, as the majority shareholder in RBS, will have to decide how to vote on the bonus. They should vote it down.""My message to him is: You've got another chance. At the AGM in April the government, as the majority shareholder in RBS, will have to decide how to vote on the bonus. They should vote it down."
The pay award sparked anger across the political spectrum with one Lib Dem minister calling for Mr Hester to waive the payment and the Mayor of London, Conservative Boris Johnson, urging the government to "step in". Professor Chris Roebuck of Cass Business School in London says there is little the government can do about pay and bonuses at RBS, because they are determined by overseas banks.
But No 10 has said the proper processes were followed and it was up to Mr Hester to decide whether to accept "In London there are 23 international banks, of which only three are British," he said.
George Osborne has just told me the government will not vote against Stephen Hester's bonus as a shareholder at the April AGM.George Osborne has just told me the government will not vote against Stephen Hester's bonus as a shareholder at the April AGM.
Ed Miliband had thrown down the gauntlet on this today, but the chancellor has declined to pick it up.Ed Miliband had thrown down the gauntlet on this today, but the chancellor has declined to pick it up.
"Pay levels in London are determined by those other 20 overseas banks who determine their pay on what's happening globally, and if the British banks don't play along and if RBS doesn't play along, all it means is that somebody who works for RBS has to walk 50 yards across the street to Deutsche Bank to get more money."
The pay award sparked anger across the political spectrum with one Lib Dem minister calling for Mr Hester to waive the payment and the Mayor of London, Conservative Boris Johnson, urging the government to "step in".
But No 10 has said the proper processes were followed and it was up to Mr Hester to decide whether to accept
The contract agreed in 2009 meant Mr Hester was entitled to be considered for a bonus, a spokesman said.The contract agreed in 2009 meant Mr Hester was entitled to be considered for a bonus, a spokesman said.
"That process was established by the previous government and that process is reflected in a bonus which is less than half the bonus Stephen Hester was paid last year."That process was established by the previous government and that process is reflected in a bonus which is less than half the bonus Stephen Hester was paid last year.
"The public sector shareholder has taken a keen interest in this and has had an influence on it.""The public sector shareholder has taken a keen interest in this and has had an influence on it."
The bonus is not payable for three years, when the final amount will be determined by the firm's share price.The bonus is not payable for three years, when the final amount will be determined by the firm's share price.
Several City and business analysts have said Mr Hester is entitled to receive a bonus for his performance.Several City and business analysts have said Mr Hester is entitled to receive a bonus for his performance.