In support of Stephen Hester

I don't suppose you'll find that headline in many newspapers this morning.

Stephen Hester is, of course, the Chief Executive of troubled bank RBS, which is 83% owned by the Government (not as many people seem to think, by the taxpayer). Mr. Hester receives a salary of £1.2 million a year and was due to receive a bonus this year of about £1.5 million, payable in RBS shares. After a lot of hoo-ha, the Government said this was too much and finally his bonus has been negotiated down to just less than a million. The unions and the ignorant are up in arms.

Many critics begin their argument with 'Mr. Hester is a civil servant'. He's not. The last government, a socialist one, by the way, had plenty of opportunity to put a civil servant into the job (maximum salary usually about £250,000) but it didn't. It chose to put in a banker and negotiated a remuneration package for him. This, as stated above, was a basic salary of £1.2m and a bonus to be decided by the bank's remuneration committee, according to certain pre-arranged criteria. I have no idea whether Mr. Hester would have done, or would now do, the job for less, but that is the deal which was agreed. The Government cannot go back on that deal, and when they tried to lean on the remuneration committee (in order to make it look good politically for David Cameron) they threatened (some say the whole board threatened) to resign. Indeed how could RBS take on new employees if they thought the Government might interfere after a year or so and cut their wages for political reasons?

Mr. Hester should insist on the money he is entitled to. I hope he's worth it, but that's another matter.