Goodwin could lose knighthood but McConnell claims honours system is ‘fair’ and ‘independent’

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By a Newsnet reporter 

UK Deputy PM Nick Clegg has become the third Westminster party leader to support stripping Sir Fred Goodwin of his knighthood.

The former head of the Royal Bank of Scotland provoked outrage after walking away with a pension pot of millions, leaving taxpayers to foot the cost of a £45 billion bailout to rescue the bank.  83% of the shares in the bank are still owned by the taxpayer.

By a Newsnet reporter

UK Deputy PM Nick Clegg has become the third Westminster party leader to support stripping Sir Fred Goodwin of his knighthood. 

The former head of the Royal Bank of Scotland provoked outrage after walking away with a pension pot of millions, leaving taxpayers to foot the cost of a £45 billion bailout to rescue the bank.  83% of the shares in the bank are still owned by the taxpayer.

Last week Prime Minister David Cameron made it known that he was ‘sympathetic’ to moves to strip the disgraced financier of his title. 

Speaking to the Daily Mail, the Deputy Prime Minister said:  “Honours should be deserved and awarded to unique people who have made Britain a better place.

“I sympathise with those who think it a travesty for a man who did so much damage to the British economy and made so much money in the process to retain his knighthood.

“I understand the outrage and there is an independent process that deals with revoking honours – they must be left to make their own decision on this.”

Goodwin was granted the knighthood in 2004 under the previous Labour government.  Labour leader Ed Miliband has admitted that Labour was mistaken in awarding Goodwin the knighthood, saying that his party was “clearly wrong” to nominate the banker for an honour.

Gordon Brown, who was Chancellor at the time, is said to have supported granting Goodwin his title.  However it emerged yesterday that the former Labour / Lib Dem Scottish government headed by Jack McConnell were the main force pushing for Goodwin’s nomination.  

Speaking to the Telegraph newspaper Mr McConnell, who was himself awarded a peerage, said that Goodwin was not the only person to blame for the collapse and should be given a fair hearing.  Mr McConnell claimed that the honours system was “fair and independent”.

The former Labour First Minister said: “Fred Goodwin made mistakes, but so did a lot of other people at RBS, including people on the board who also have honours.  They appointed him and agreed the strategy and have never been held to account.

“I think the Government, both the Labour and Tory government before it, were making mistakes about regulation.

“I sympathise with the public concern on this issue but I think if you are going to have a system that is relatively independent and fair in allocating these awards then you need to have system that is independent and fair in looking at removing them.”

In 2007 the SNP ended the involvement of Scottish Government Ministers in the honours nomination process.

The matter will now be considered by a Parliamentary committee which has the power to remove the honour from the disgraced former banker.  Honours Forfeiture Committee is made up of some of senior civil servants who will examine whether Goodwin deserves the honour, which he was granted for ‘services to banking’.

The move comes after an official report by the Financial Services Authority into the collapse of RBS laid the blame on Goodwin and his aggressive expansionist policy for leading RBS into an ill-fated take over of Dutch bank ABN Amro.

Conservative MP Matthew Hancock has tabled a series of Commons questions over the granting of the honour to the former RBS chief.  Mr Hancock is demanding the release of all correspondence between Treasury officials, ministers and special advisers relating to the honours list of 2004.  70 MPs have signed a Commons motion demanding that the honour be withdrawn.