If we ever needed convincing (which most of us do not) that governments simply do not “get it”, the latest news on bank remuneration should be adequate proof. Perhaps public reaction to the MPs’ expense claims story was not enough to show ministers that the British public will not longer tolerate paying for a gravy train; but the shock with which we have met the new pay package for the Royal Bank of Scotland’s chief executive is should concern them.

The fact is that we own this bank – we have ever since they, and many others, got into such a mess that they could no longer survive without a massive injection of taxpayers’ money. So it is outrageous that someone who is effectively a civil servant should receive a remuneration package worth a reported £9.7 million.

How much does this top banker earn?
Quite frankly, the basic salary of £1.2 million sounds far too much to pay someone to run a failing business. Of course, there will be those who argue that this amount is needed to turn the bank around and put it back on a profitable basis. But there are literally thousands of highly talented people who could probably do the job just as well – perhaps even better if they started from the point that they are there to help clean up the mess that they have created themselves.

I must say I am not one of those who would ever wish to do the job; but I know several really clever people who could make a good 'fist' of it for much less money.

And it is not just the basic salary that offends so much. When you add £420,000 in guaranteed pension funding and all the other benefits and bonuses – some of which look remarkably short-term – the whole thing starts to reek of “old boy network”. Remind anyone of Sir Fred Goodwin (who is now giving up a little bit of his massive and immediate pension, I see)?

Government does not understand
What should the government be doing to protect our interests? I am not at all convinced that they understand how ordinary – naturally “middle of the road” – people feel about the way we are consistently ignored. They talk a good game about listening and cleaning up their act, but politicians appear to be incapable of acting with any form of integrity and thinking about the interests of the nation, rather than feathering the nests of themselves and their friends.

If this sounds harsh, just consider that we now own the banks, but they have done nothing but whine about how they have to rebuild their capital if they are to compete in world wide markets. This mess was of their making, not ours. They know that they could not be allowed to fail – that is why they made themselves so large – so they simply ignored probity and good management. Now we are expected to pay them massive salaries – not to mention bonuses and pension contributions – to put things right.

I suspect that the banking system will be put back on an even keel by events, not the efforts of a few highly paid individuals. Quite frankly, we could probably put a few reasonably intelligent people in the top banking jobs, pay then a realistic salary and get the same effect. We could probably do the same with the politicians; but nobody with any self respect would want that job.

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