RBS cuts pensions for staff
August 27, 2009
The Royal Bank of Scotland, in which the government has a 70 per cent stake, has announced that it will be reducing pension benefits to many of its staff.
The bank’s proposal is to continue with its pensions linked to an employee’s salary, but to cap pensionable salary increases at either 2 per cent, or if it is lower, the rate of inflation.
Those employees who wish to take a pension immediately when opting for early retirement will see the lump sum of their pension reduced.
The moves have outraged the unions.
This year the bank awarded its former chief executive Fred Goodwin a pension worth £650,000 for life. The result was anger and political uproar as the economy was in free fall and the bank was close to collapse. The pension was eventually reduced.
Rob MacGregor of the union Unite has spoken out about the banks decision. “Against the back drop of Sir Fred Goodwin’s bumper pension these planned changes add insult to injury to workers paying the price for a crisis for which they hold no responsibility.” He went on to say: “RBS staff, who already face great uncertainty in the face of major job losses, now face a future with retirement benefits severely reduced.”
Thanks to www.reuters.com for the above quotes, for more information on this article please visit their website.
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