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RBS chairman gives up £1.4m bonus

Bank announces that Sir Philip Hampton will not receive bonus amid controversy over decision to award RBS chief executive Stephen Hester £963,000

Sir Philip Hampton, the chairman of the Royal Bank of Scotland, has given up a £1.4m bonus he was due later this year, the bank has announced.

The RBS statement came amid continued controversy over the bank’s decision to award Stephen Hester, its chief executive, a £963,000 bonus. A spokesman said: “Sir Philip Hampton will not receive the 5.17m shares he was awarded in 2009 when he joined RBS.”

The Labour leader, Ed Miliband, urged the government to block the bonus for Hester, but David Cameron said the contract was arranged by the previous Labour government and should be honoured.

Hampton is thought to have told the bank’s remuneration committee it would not be appropriate for him to take the shares to which he is entitled. He was given the scheme when he was appointed at the 83% state-owned bank as part of a three-year long-term incentive deal.

It is understood RBS were not due to offer Hampton the share bonus, based on a variety of factors, until next month, but he chose to waive the entitlement earlier.

His decision is likely to put more pressure on Hester, who has faced calls from unions, politicians and the public to turn down his award of almost £1m.

Speaking at Chequers on Saturday, the prime minister said it was up to the chief executive to decide whether to give up his bonus. “It’s obviously his decision,” Cameron said. “My decision is to make sure the team at RBS get on with the job of turning the bank round, and we made our views very clear on the bonus and that’s why it was cut in half compared to last year.”

In a statement on Saturday, Miliband encouraged the government to vote against the bonus at the RBS annual general meeting in April.

“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,” he said.

“Having spent weeks boasting he would block bonuses, David Cameron refuses to even publicly explain why he has changed his mind.” © 2012 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds