31 Jan 2012

Goodwin stripped of knighthood

Former Royal Bank of Scotland chief executive Fred “the shred” Goodwin loses his knighthood in a “very political strip show”, as Channel 4 News Political Editor Gary Gibbon reports.

The Cabinet Office said the knighthood had been removed on the advice of the forfeiture committee because Mr Goodwin had brought the honours system “into disrepute”.

Mr Goodwin, known as “Fred the shred” for his cost-cutting reputation, received his knighthood for “services to banking” – but he then led the Royal Bank of Scotland (RBS) to the brink of collapse. The bank was bailed out by the taxpayer in 2008 at the height of the economic crisis.

The Cabinet Office said the award had been “cancelled and annulled”.

In a statement, it said: “In 2008 the Government had to provide £20bn of new equity to recapitalise RBS and ensure its survival and prevent the collapse of confidence in the British banking and payments system. Subsequent increases in government capital have brought the total necessary injection of taxpayers’ money in RBS to £45.5bn.

A very political 'strip' show
It normally requires a professional disqualification or a criminal offence to get you stripped of an honour, writes Channel 4 News Political Editor Gary Gibbon.
It is normally a decision kept a million miles from everyday politics. But Mr Fred Goodwin is "sir" no longer at a time of maximum political convenience to the government as it wrestles with a very public and toxic row over bankers' bonuses.
Read more in Gary Gibbon's blog on why 'Sir Fred' is no more

“Both the Financial Services Authority and the Treasury select committee have investigated the reasons for this failure and its consequences. They are clear that the failure of RBS played an important role in the financial crisis of 2008-9 which, together with other macroeconomic factors, triggered the worst recession in the UK since the Second World War and imposed significant direct costs on British taxpayers and businesses.

“Fred Goodwin was the dominant decision maker at RBS at the time. In reaching this decision, it was recognised that widespread concern about Fred Goodwin’s decisions meant that the retention of a knighthood for ‘services to banking’ could not be sustained.

“The scale and severity of the impact of his actions as CEO of RBS made this an exceptional case.”

Banking on a title
"Would the government think about removing from these guys the one thing it could give itself the power to remove, the one thing that probably matters to them more than most things: their titles?" Jon Snow posed that question back in 2009.
"Rest assured, if good old Tom, or Dick, or Harry, has to book a flight or a restaurant table, it won't be quite as good a table or class of airline seat as it would have been had it been for Sir Tom, Sir Harry, or Sir Dick. That's how UK plc still works."
Read more: Should our bankers keep their titles?
Stripped! Who else has been dishonoured?
Robert Mugabe, Zimbabwe's leader who stands accused of major human rights abuses, lost his honorary knighthood in 2008.
Benito Mussolini, the former Italian dictator, was stripped of his Knight Grand Cross of the Order of Bath, in 1923.
Nicolas Ceausescu, executed former communist leader of Romania. His honorary British knighthood was annulled in 1989.
Anthony Blunt, an art historian exposed as a spy for the Soviet Union, was stripped of his knighthood in 1979.
Lester Piggott, the well-known jockey, had his OBE removed after being sent to prison for tax evasion in 1987.
Prince Naseem Hamed, former boxing world champion, had his MBE removed in 2007 following a prison term for dangerous driving.