Former Royal Bank of Scotland (RBS) boss Fred Goodwin has bowed to pressure to cut his highly controversial pension by more than £200,000 per year, it has been reported.
The voluntary reduction would reduce the value of Goodwin’s pension pot by at least £4m, although he would still receive a pension of roughly £350,000 per year. The offer to cut his pension came after RBS threatened Goodwin with legal action.
According to Sky News, the government will announce a deal to accept a cut in the value of the pension soon.
However, the deal would still leave Goodwin with a bigger pension than he would have received if he had been dismissed instead of leaving on agreed terms. It is therefore likely to attract criticism for not going far enough.
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Goodwin did a deal with RBS in October 2008 that allowed him to receive a pension worth £703,000 a year.
City minister Lord Myners has been criticised for enabling Goodwin to receive rewards for his failure at the bank, which was bailed out by the government.
