You have probably read the stories that have been in several national papers recently that RBS has been spending up to £300,000 on corporate hospitality at Wimbledon for a select small group. It looks like RBS has again managed to alienate alot of its staff, customers, shareholders, the media and the public. Perception is everything and such a substantial investment should clearly have been questioned, but is this type of reporting really in the public interest?
Is this a pre-existing contract which would cost as much to cancel? Also, are the potential guests revenue generators for the bank? And, if they are, how many £millions of profits does this select group generate?
Even in a recession, entertaining has a valuable role in building and maintaining relationships. It is a false economy to cut it out entirely, even short-term, and particularly if the huge cost of cancelling would mean a total waste of “taxpayers' money”. Which is worse: to pay £200,000 in cancellation fees and get nothing for it, or to pay an extra £100,000 and maintain relationships with key individuals who will be essential to the future growth and prosperity of the bank?
By the way, if this helps to drive the RBS share price up to 70p, we, the taxpayer, will have made an £8 billion net profit out of this deal. Now that would be a great deal of “public interest"
Nigel CooperExecutive DirectorP&MMMilton KeynesMK14 6LY
