Northern Rock is going to be paying out...but sadly not to its long suffering share holders.
No, instead it is going to be rewarding its staff!
Now, stop us if you think we are being a little harsh here but doesn't that sound like Northern Rock is giving two fingers to everyone who has lost money throughout this whole sorry episode?
Why is Northern Rock rewarding mass incompetence?
In the words of Lloyd Grossman in "Through the Keyhole", let's look at the clues:
Is Northern Rock haemorrhaging money? Check
Is Northern Rock 6 feet under in debt? Check
Have Northern Rock shares dropped from £12.52 to as low as 98p? Check
Has Northern Rock been helped by £35 billion from the Government, which could rise to £45 billion by February if a buyer is not found? Check
Has another potential bidder for Northern Rock pulled out? Check
Is Northern Rock lavishing rewards on the employees who got them into this mess in the first place? Check
Yes, amazingly, the majority of Northern Rock will get a bonus of 2% of their annual salary plus a one-off £200 Christmas payment.
And did we mention that they will get a 4% rise in their annual salary from January? No? Well they will!
Northern Rock defended the one-off Christmas payment and the 2% bonus, because it is in recognition of workers' "great loyalty" at a "difficult" time for the business.
Oh, well then it makes it ok....
The deal was hammered out last week with the Unite union who last week warned the beleaguered bank that without its staff there would be no company left to rescue.
The total award for an average employee earning £25,000 would leave them £1,700 better off. But the package is awarded to all staff up to and including assistant directors. Their salary can range up to £100,000. At the highest level this could mean a total bonus package of £6,200.
We bet quite a few of you with money invested in Northern Rock would like to be given over 6 grand wouldn't you?
Naturally, Northern Rock denied any suggestions that senior staff such as assistant directors would benefit from the pay offs.
"This mostly refers to clerical staff, and stops four levels below the board," said a Northern Rock spokeswoman. She declined to say how the package compared to previous agreements but insisted that it "recognises the efforts of staff over the year, as well as the current position".
One Northern Rock employee said they were surprised by the pay package, commenting that "we were just glad to still have our jobs at Christmas, let alone an above-inflation pay rise and bonuses."
Unsurprisingly their decision to give staff a pay rise and a Christmas bonus has been attacked by Northern Rock's shareholders. Customer Robin Ashby, head of the Small Shareholders Association of Northern Rock customers said:
"This is disgraceful and entirely inappropriate. A discredited management team is rewarding employees for their failure and I'm sure all customers and investors will be furious".
To be honest, Robin, we think that many other people will feel furious at this!
In addition, Matt Sinclair, of the Taxpayers' Alliance, said:
"They should be getting pay cuts, not pay rises. Apparently the meaning of performance-related pay is lost on staff at Northern Rock. What performance? Their failure has put tens of billions of taxpayers' money at risk with billions unlikely to ever be recovered."
So, just how can Northern Rock justify this course of action?If anyone can explain it, do let us know, as we are all scratching our heads here at the Money Hospital!
Can Branson get Northern Rock get out of a pickle?