Following the union’s threat of legal action, TSB has confirmed that it will publish the Slaughter and May report into last year’s IT meltdown in the next few weeks.
Members will recall we wrote to Sabadell’s Company Secretary saying: “Shareholders are entitled to see that report and delaying its publication any longer is unacceptable. Unless we get a response setting out when the report will be published, we will instruct our legal advisers and seek redress through the UK Courts”. That was a few weeks ago.
The final cost of the report is a staggering £25 million. That’s roughly £83,000 for each of the report’s nearly 300 pages. To put that figure in perspective, TSB could have given each member of staff a 12.5% one-off bonus for the amount of money its cost to produce the Slaughter and May report. There is no justification for spending that amount of money on such a report. It’s obscene, especially at a time when the bank is going to be announcing more branch closures and job losses. Why legal costs were allowed to spiral out of control will be something that shareholders will want to investigate?
The TSB board is being severely criticised for not asking the right questions and for taking an overly optimistic view of the success of the migration. Paul Pester and a large number of his colleagues, some of whom are still working for the bank, have been stripped of their deferred share awards going back to 2015. The report should make clear whether this was justified and if so, why.
It seems that some of those senior executives are even threatening legal action. We will see whether TSB sticks to its guns and takes those individuals to Court, if necessary.
Management failure on such a grand scale cannot be rewarded. We would expect those individuals criticised in the report who are still working for the bank to be subject to disciplinary action. Furthermore, those members of the board who were around whilst this fiasco was unfolding, including the Chairman, Richard Meddings, should also be asked to leave with immediate effect.
“Take Out The Trash Day”
Members who like TV series ‘The West Wing’ will remember the episode called “Take Out The Trash Day”. That’s when, in order to avoid press scrutiny, organisations/governments publish all their most embarrassing reports or bad news in the hope that there will be fewer people around to scrutinise what’s been published. It’s normally done just before Christmas or at the end of a parliamentary session. In order to avoid scrutiny, TSB could publish the report either during the election or, if it’s as bad as we think it is, on election day. We would urge it to resist such a temptation but either way we’ll be on the case!
Members with any comments or questions can contact the Union’s Advice Team on 01234 716029.