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RBS unions seek larger slice of profit

Katherine Griffiths,Banking Correspondent
Thursday 19 February 2004 01:00 GMT
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Royal Bank of Scotland, which is expected to unveil record profits of about £7bn today, has hit back at attacks from unions that it is not sharing out enough among staff.

RBS, which is forecast to make some of the largest profits in this year's banking reporting season, claimed its remuneration for its 111,000 staff was "very competitive". Most employees receive a package of basic pay, bonus and a share of profits, RBS said.

The move came after Unifi, the finance union, called on the bank to boost the pay of its staff, some of whom, it claimed, are not even in line for a pay rise.

Clare Moody, the Unifi negotiating officer, said: "No doubt we will see significant increases in the remuneration of those at the top. Chief executive Fred Goodwin's bonus was nearly £2m last year. When times are hard, the bank says it cannot afford to pay. Now times are good, it does not have an excuse."

Unifi has estimated that RBS's employees each generated an average of £64,000 of profits for the group last year. Yet, Unifi claimed, the current negotiations over pay will see 25,000 staff denied a pay rise in line with inflation this year.

RBS, which will announce the latest profits share for employees today with its annual results, said its workforce has received 10 per cent of their salary in this form every year for the past four years.

Nearly four-fifths of staff have received an additional bonus of, on average, 10.6 per cent of salary. The second bonus, which is performance-related, is not paid to all staff.

Analysts have forecast record profits from almost every bank in this year's reporting season, in a move which shareholders will no doubt welcome. However, consumer groups are pointing to the bumper figures as evidence that the UK banking market is anti-competitive.

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