RBS 2004 Annual Report Download - page 135

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Annual Report and Accounts 2004
Directors’ remuneration report
Governance
Directors’ pension arrangements
During the year, Sir Fred Goodwin, Norman McLuskie, Gordon
Pell, Iain Robertson and Fred Watt participated in The Royal
Bank of Scotland Group Pension Fund (‘the RBS Fund’). The
RBS Fund is a defined benefit fund which provides pensions
and other benefits within Inland Revenue limits.
The pension entitlements of Sir Fred Goodwin, Mr Pell, Mr
Robertson, and Mr Watt within the RBS Fund are restricted
by Inland Revenue limits as set out in the Finance Act 1989.
Additional life assurance cover in excess of these limits is
provided by a separate arrangement. Arrangements have been
made to provide Sir Fred Goodwin and Mr Pell with additional
pension benefits on a defined benefit basis outwith the RBS
Fund. The figures shown below include the accrual in respect
of these arrangements. Mr Watt is provided with additional
pension benefits on a defined contribution basis and
contributions made in the year are shown below.
Sir George Mathewson receives life insurance cover under an
individual arrangement. The non-executive directors do not
accrue pension benefits, other than Mr Robertson who
continues to accrue benefits in the RBS Fund after his
appointment as a non-executive director.
Lawrence Fish accrues pension benefits under a number of
arrangements in the USA. Defined benefits are built up under
the Citizens’ Qualified Plan, Excess Plan and Supplemental
Executive Retirement Arrangement. In addition, he is a
member of two defined contribution arrangements – a
Qualified 401(k) Plan and an Excess 401(k) Plan.
As in the 2003 Report and Accounts, disclosure of these
benefits has been made in accordance with the Stock
Exchange Listing Rules and the Combined Code and with
the Directors’ Remuneration Report Regulations 2002.
Transfer value
Additional Additional for the additional
pension pension Increase pension
earned earned in transfer earned
Accrued during the during the Transfer Transfer value during during the
entitlement at year ended year ended value as at value as at year ended year ended
Age at 31 December 31 December 31 December 31 December 31 December 31 December 31 December
31 December 2004 2004 2004* 2004 2003 2004 2004*
Defined benefit arrangements 2004 000 p.a. 000 p.a. 000 p.a. 000 000 000 000
Sir Fred Goodwin 46 £381 £56 £48 £3,591 £2,674 £917 £448
Mr McLuskie 60 £205 £11 £7 £3,430 £3,358 £72 £87
Mr Pell 54 £247 £18 £12 £3,592 £2,930 £662 £171
Mr Robertson 59 £32 £4 £3 £565 £449 £116 £45
Mr Watt 44 £7 £2 £2 £62 £40 £22 £15
Mr Fish 60 $1,140 $257 $257 $10,046 $9,966 $80 $2,269
* net of statutory revaluation applying to deferred pensions
Notes:
(1) There is a significant difference in the form of disclosure required by the Combined Code and the Directors’ Remuneration Report Regulations 2002. The former requires the
disclosure of the additional pension earned during the year and the transfer value equivalent to this pension based on stock market conditions at the end of the year. The latter
requires the disclosure of the difference between the transfer value at the start and end of the year and is therefore dependent on the change in stock market conditions over
the course of the year. The above disclosure has been made in accordance with the Combined Code and the Directors’ Remuneration Report Regulations 2002.
(2) Mr McLuskie retired on 23 August 2004 at his normal pension age. The figures for him above have been calculated as at his retirement date rather than 31 December 2004.
(3) The figures for Mr Pell include an additional pension secured by a transfer from his previous employer which increases in line with statutory revaluation, not salary inflation.
(4) The transfer values disclosed above do not represent a sum paid or payable to the individual director. Instead they represent a potential liability of the company /pension scheme.
(5) The transfer value for Mr Fish as at 31 December 2004 is based on a retirement age of 65.
Contributions and allowances paid in the year ended 31 December 2004 under defined contribution arrangements were:
2004 2003
000 000
Mr Watt £128 £109
Mr Fish $91 $90
Bob Scott, Chairman of the Remuneration Committee
23 February 2005