RBS 2013 Annual Report Download - page 475
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Notes on the consolidated accounts
473
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.
2013 2012 2011
£m £m £m
Operating leases
Minimum rentals payable under non-cancellable leases (1)
- within 1 year 348 399 468
- after 1 year but within 5 years 1,143 1,253 1,453
- after 5 years 2,144 2,286 2,714
3,635 3,938 4,635
Property, plant and equipment
Contracts to buy assets to be leased under operating leases (2) — — 2,607
Other capital expenditure 38 37 35
38 37 2,642
Contracts to purchase goods or services (3) 1,162 959 1,130
4,835 4,934 8,407
Notes:
(1) Predominantly property leases.
(2) Amount related to RBS Aviation Capital which was sold in 2012. Included £486 million due within one year.
(3) Of which due within 1 year: £373 million (2012 - £444 million; 2011 - £483 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 £462
million (2012 - £476 million; 2011 - £502 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 Prudential
Regulation Authority. In addition, the FSCS has the power to raise levies
on a firm 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 compensation costs
associated with the failure of Bradford & Bingley, Heritable Bank,
Kaupthing Singer & Friedlander, Landsbanki ‘Icesave’ and London
Scottish Bank plc. The interest rate on these borrowings is subject to a
floor being the higher of 12 month LIBOR plus 100 basis points or the
relevant gilt rate for the equivalent cost of borrowing from HMT. The
FSCS and HM Treasury have agreed that the period of these loans will
reflect the expected timetable for recoveries from the estates of Bradford
& Bingley and the other failed banks. The FSCS will levy the deposit
taking sector for its share of the balance of the principal outstanding for
the non-Bradford & Bingley loan prior to the FSCS loan facility with HMT
expiring in March 2016. In addition, the FSCS recently announced HMT’s
intention to collect an interim payment relating to resolution costs for
Dunfermline Building Society of £100 million. The capital element of the
levy is expected to rise to £399 million (£363 million in the 2013/14
scheme year).
The Group has accrued £144 million for its share of estimated FSCS
levies for the 2013/14 and 2014/15 scheme years.