SIR James Crosby will not be living off bread and water after he renounced his knighthood, and waived 30 per cent of his annual pension, as recompense for his catastrophic role in the financial collapse of HBOS.
The Leeds-born banker – who will become plain Mr Crosby once his application to the Cabinet Office’s Forfeiture Committee has been formally approved – will still command an annual pension of some £406,000.
Given that HBOS required a taxpayer bailout in excess of £20bn – and that the whole country is still paying an extraordinary price for the failures of Sir James, his successor Andy Hornby and the bank’s chairman Lord Stevenson – many will argue that he has escaped lightly.
A man whose inglorious fall now rivals the battered reputation of RBS bête noire Fred Goodwin, amongst others, Sir James and his acolytes are still not barred from working within the wider financial services industry – and bookmakers Coral have said that the aforementioned Mr Hornby is doing “a very good job” at the helm.
Still, at least Sir James can renounce the knighthood that he received in the 2006 on the now spurious grounds of “services to finance”; there is no legal mechanism for former HBOS chairman Lord (Dennis) Stevenson to be stripped of the peerage that he was awarded in 1999 when he became chairman of the bank.
Despite this, Sir James has – inadvertently or otherwise – set an important precedent. By acknowledging his role in the decisions that so nearly broke the bank, he has shown that individuals can be held to account for past misdeeds. This now needs to be applied to the public sector’s “reward for failure” culture where many enjoy lucrative pensions and knighthoods in spite of the passing of time taking the shine off their records.