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Royal Bank of Scotland was embroiled in a new controversy after it emerged that it would be spending hundreds of thousands of pounds on entertaining at Wimbledon.
RBS is due to spend up to £300,000 on corporate hospitality, despite being saved from possible collapse after being given a £20 billion injection by the Government last year. The bank’s troubles also prompted the dismissal of tens of thousands of employees.
The tournament package for senior executives and customers includes fine food and £75 bottles of champagne. A leaked e-mail from an All England Club official to RBS listed how the “entertainment suite” would be available for more than 40 guests for the entire 13-day tournament. The deal worked out at £19,500 a day.
Added to the total bill will also be £100 for each Centre Court seat, £75 a person for lunch and a one-off fee of £150 for flowers.
Vince Cable, the Liberal Democrat Treasury spokesman, said that it was “totally insensitive” for “corporate fat cats to have a good time at public expense”.
John Mann, a Labour MP and member of the Commons Treasury Select Committee, said: “It’s disgusting. There is no place whatsoever for this kind of largesse at the current time.”
The e-mail, leaked to The Mail on Sunday, goes on to say how each marquee will come equipped with 40 dining chairs, a desk, 12 garden chairs and three tables with parasols. Although the bank will be able to decorate the marquee with a company logo, it will not be able to bring its own alcohol.
The menu offered to executives and guests will include Shetland Isles salmon, sweet chilli prawn and crayfish and Parma ham. For dessert, a baked lemon-curd cheesecake and a double chocolate truffle torte will be available.
A spokeswoman for RBS said that she was unable to confirm the exact costs of the package but noted that the deal had been a long-standing agreement. She said that customers rather than staff would be attending.
“We fully recognise that, as we get our house in order, we need to be seen to change the way we operate,” she said. “We have cut our hospitality by 90 per cent this year to recognise the reality of our situation.
“The cost of the Wimbledon event is already sunk in and contracted. We are using it to support our charity partners and customer relationships, which are vital to our success.”
The State took a 70 per cent stake in RBS after it suffered a £24.1 billion loss, the largest in UK corporate history.
Some other corporations have decided to cut their entertainment budget during the recession. The BBC will not undertake any corporate entertaining during the Wimbledon fortnight this year.
Meanwhile, Sir Keith Mills, the founder of the Air Miles and Nectar loyalty programmes, has started legal action against Coutts, a subsidiary of RBS. The claim relates to the bank’s advice to Sir Keith, in December 2007, that he should deposit £65 million of his savings in AIG Life Premier Bonds.
Sir Keith claims that the advice was negligent and that that negligence was compounded in March 2008 when he contacted Coutts to express concerns about the continuation of that investment. However, he asserts that he was told that Coutts was “still not concerned with any risk to investors such as yourself”. Coutts has denied any negligence in the case.
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