January 31, 2012

Bill Esterson


The Prime Minister allowed the Royal Bank of Scotland to give its Chief Executive a bonus of nearly £1million. Nick Clegg, the Lib Dem leader and Deputy Prime Minister said he would not intervene to stop the bonus. It is no surprise that the public in Central Sefton are furious that they are paying for the deficit in lost jobs, cuts in services and the removal of essential tax credits. Only on Monday, following the political and public backlash, did Stephen Hester announce he wouldn't be accepting his bonus.

The public are the ones who will lose services for elderly and disabled relatives and benefits for cancer patients. Meanwhile, Tory and Lib Dem Ministers will not notice the effects of the cuts and their friends will carry on receiving bonuses without having to pay to cut the deficit.
Last year the Tory Prime Minister, David Cameron told the MPs that the reason we have difficulties with the Royal Bank of Scotland this year is the completely inadequate contract that was negotiated by the last Government and that the Government was “bound by a contract that was signed by the previous Government” in relation to bonuses paid out to Stephen Hester and other executives at the Royal Bank of Scotland.
However, since then it has emerged that Stephen Hester has no contractual right to a bonus, and that his participation in any Bonus Scheme is at the discretion of the Remuneration Committee. Indeed, Mr Cameron himself acknowledged in November that as the Government is a major shareholder in RBS. Cameron said, “we can stop the £500m” in bonuses reportedly due to RBS executives (BBC Radio 2 Jeremy Vine Show, November 10 2011).
And the Lib Dem Business Secretary, Vince Cable, said in September that “certainly the Government through its shareholding body which is the UKFI could have intervened [in relation to the pay of the Chief Executive of RBS] but Mr Cable took the view that he and the new head of Lloyds, the other partly state-owned institution, should and are turning around a taxpayer-run institution” (BBC Radio 4 Today Programme, September 19 2011).
The Prime Minister and other senior members of the Tory-Lib Dem Government are on record acknowledging that they do have the power to intervene to reduce the bonuses paid to senior executives at taxpayer-owned banks, I hope the government will explain to the public why he previously told MPs that he did not have any such power. I also hope that he will explain why his Government has decided, in its role as the majority shareholder in RBS, to approve a bonus to Stephen Hester worth almost £1 million.
New figures show a 20% increase in the number of cancelled urgent operations as a result of the cuts by the government.
Patients are beginning to pay the price for the Government's mismanagement of the NHS. It is unacceptable that more people are waiting more than four hours in A&E, more people are waiting more than 18 weeks for an operation and more urgent operations are being cancelled.
Every day more evidence comes to light showing that Ministers have lost Labour's firm grip on the NHS. The Government has thrown the health service into turmoil with its confused policies and chaotic management.
The time has come for the Government to halt its destabilising NHS reorganisation and let it focus on what matters: maintaining standards of patient care.
The latest US growth figures report the US economy is now 0.7% above its pre-crisis peak, while the UK is now 3.8% below. The US economy is growing steadily while the UK economy is stalling and families across the country are paying the price for the wrong economic policies.
The US Government has taken a more balanced and steady approach to deficit reduction up to now and they have more than recovered all the output lost in the global recession, while in Britain we are still almost 4% below our pre-crisis peak. And since Tory Chancellor, George Osborne’s spending review in the autumn of 2010 our economy has grown by just 0.3% while the US has grown by 2.2% over the same period.
While the US growth figures compare favourably to Britain, policymakers in America are rightly concerned and debating what more they can do to boost jobs and growth. Yet here in Britain the Conservative-led government has sent our economy into reverse and is set to borrow £158 billion more than planned, but complacently insist they are going to plough on regardless.
Of course we need tough decisions on tax, spending and pay, but to get the deficit down we also need to get our economy moving and get people off benefits and into work. David Cameron and George Osborne have eight weeks until the Budget to learn that lesson and change course.
The Tory-Lib Dem government has cut too far and too fast. People in Maghull, Crosby and Formby needs jobs and a growing economy, which is why a tax on bankers' bonuses should be introduced to pay for jobs for young people and for building of new homes. We need to get the economy growing again and we can follow the lead of the American government by investing in just that.