RBS 2011 Annual Report Download - page 403

RBS Group 2011 401
Contractual obligations for future expenditure not provided for in the accounts
The following table shows contractual obligations for future expenditure not provided for in the accounts at the year end.
2011
£m
2010
£m
2009
£m
Operating leases
Minimum rentals payable under non-cancellable leases (1)
- within 1 year 468 497 479
- after 1 year but within 5 years 1,453 1,515 1,691
- after 5 years 2,714 2,892 3,055
4,635 4,904 5,225
Property, plant and equipment
Contracts to buy, enhance or maintain investment properties — 2 —
Contracts to buy assets to be leased under operating leases (2,3) 2,607 2,585 2,724
Other capital expenditure 35 150 89
2,642 2,737 2,813
Contracts to purchase goods or services (4) 1,130 950 1,025
8,407 8,591 9,063
Notes:
(1) Predominantly property leases.
(2) Of which due within 1 year: £486 million (2010 - £263 million; 2009 - £370 million).
(3) At 31 December 2011, £2,607 million related to the RBS Aviation Capital business which is included in disposal groups.
(4) Of which due within 1 year: £483 million (2010 - £440 million; 2009 - £579 million).
Trustee and other fiduciary activities
In its capacity as trustee or other fiduciary role, the Group may hold or
place assets on behalf of individuals, trusts, companies, pension
schemes and others. The assets and their income are not included in the
Group's financial statements. The Group earned fee income of £502
million (2010 - £629 million; 2009 - £1,355 million) from these activities.
The Financial Services Compensation Scheme
The Financial Services Compensation Scheme (FSCS), the UK's
statutory fund of last resort for customers of authorised financial services
firms, pays compensation if a firm is unable to meet its obligations. The
FSCS funds compensation for customers by raising management
expenses levies and compensation levies on the industry. In relation to
protected deposits, each deposit-taking institution contributes towards
these levies in proportion to their share of total protected deposits on 31
December of the year preceding the scheme year (which runs from 1
April to 31 March), subject to annual maxima set by the Financial
Services Authority. In addition, the FSCS has the power to raise levies on
afirm that has ceased to participate in the scheme and is in the process
of ceasing to be authorised for the costs that it would have been liable to
pay had the FSCS made a levy in the financial year it ceased to be a
participant in the scheme.
The FSCS has borrowed from HM Treasury to fund the compensation
costs associated with Bradford & Bingley, Heritable Bank, Kaupthing
Singer & Friedlander, Landsbanki ‘Icesave’ and London Scottish Bank
plc. These borrowings are on an interest-only basis until 31 March 2012.
The annual limit on the FSCS interest and management expenses levy
for the period September 2008 to March 2012 in relation to these
institutions has been capped at £1 billion per annum.
The FSCS will receive funds from asset sales, surplus cash flow, or other
recoveries in relation to these institutions which will be used to reduce the
principal amount of the FSCS's borrowings. After the interest only period
aschedule for repayment of any outstanding borrowings will be agreed
between the FSCS and HM Treasury in the light of market conditions at
that time and the FSCS will begin to raise compensation levies (principal
repayments).
The Group has accrued £157 million for its share of FSCS levies for the
2011/12 and 2012/13 scheme years.