Fidelity Global Dividend Fund

Where quality pays dividends.

If you’re looking for income, or the long-term growth potential that comes from reinvesting your dividend returns, it could be time to look further afield. Over time the reinvestment of dividend income has contributed the majority of total returns from the UK stock market*– though past performance is not a guide to the future. You can now benefit from this principle on a global scale, through top-quality companies with the ability to pay consistent or increasing dividends. Fund manager Dan Roberts selects the strongest of these. Searching all the world’s major markets, Dan can diversify the fund across geographies and sectors, aiming to reduce risk and enhance returns. Get the top global companies working for you. Call or click today. The estimated yield represents an independent assessment of future performance, though this is not guaranteed. The annual management charge is taken from the fund capital, which will affect future performance. Investments and income can go down as well as up so you may get back less than you invested. This fund may be subject to currency fluctuations. The value of tax savings depends on individual circumstances and all tax rules may change. For further information please contact our UK-based call centre or an adviser.

New fundlaunch

ISA2012

Invest in a 2012 ISA for less. 0% initial charge online.†

Annual management charges apply.

w fidelity.co.uk/dividend t 0800 368 0217

Quote SPE105

Estimated

4%Yield**

The yield is not guaranteed and will fluctuate in line with the market.

*Source: Datastream, as at 20.12.11 from the FTSE All Share Index. †0% initial charge if you invest online or by phone by midnight on 5 April 2012.The Simplified Prospectus is available in English and can be obtained from our website at www.fidelity.co.uk/importantinformation or by calling 0800 41 41 61. The full prospectus may also be obtained from Fidelity.**The estimated yield is based on an indicative fund portfolio. The actual portfolio at launch may be different, reflecting market movements. The estimated yield reflects an independent assessment of the dividends due to the indicative portfolio over the next 12 months. It reflects the yield payable after offshore taxes and other costs associated with running the fund have been taken from the fund’s income. As a result of the annual management charge being taken from capital, the distributable income may be higher but the fund’s capital value may be eroded, which will affect future performance. The yield is not guaranteed and will fluctuate in line with the yield available from the market. The fund should only be considered as a long-term investment. Issued by FIL Investments International, authorised and regulated in the UK by the Financial Services Authority. Fidelity, Fidelity Worldwide Investment, the Fidelity Worldwide Investment logo and F symbol are trademarks of FIL. CSO3284/0412/A1 established 1828

Bank withdrawals

When George Osborne became Chancellor, he took charge of a very large zombie bank with a medium-sized government attached to it. The Royal Bank of Scotland was nationalised in 2008 with assets of £2.2 trillion, almost four times state annual spending. The difference between RBS being run well or run badly could be counted in billions. The man who would make that difference was Stephen Hester, a top-flight banker who in a moment of madness had accepted the contract from Alistair Darling’s Treasury and got to work. He would not have known how his new ­masters would turn on him, demanding that he refuse his bonus of nearly £1 million.

Hester’s bonus was almost twice as large last year — but then, fewer people cared. Now the hang-a-banker mentality is back, and it is being encouraged by the government. David Cameron’s decision to hire a pollster as chief strategist has turned his government into a weather-vane. The Prime Minister tries to work out what people are saying, then attempts to say it louder. And if they don’t like bankers, well, it’s time to strip Fred Goodwin of his knighthood and square up to Mr Hester.

The furore over bonuses makes Britain seem less attractive than ever to foreigners who are mulling over whether to move their business here. Our top rate of tax, which George Osborne increased to 52p with his National Insurance hike, is the third-highest in the world. The UK divisions of global companies struggle to retain staff at a time when rivals like Singapore and Hong Kong are welcoming the rich with tax rates less than half ours. But the British government seems unwilling to mount any defence of its world-class finance industry, or to explain why bonuses are paid.

It is not greed. Most of us, if given the choice, would prefer to be paid more. This does not, alas, determine our salaries. The head of the Washington Post group assessed the value of one of its directors thus: ‘Mr Buffett’s recommendations to management have been worth — no question — billions.’ If Warren Buffett was paid $1 million for advice worth billions, this constitutes pretty good return for the shareholders. The sum may seem disgusting to someone on low pay, but it is not unjustifiable. Such are the econo-

executives at the very top of Barclays are beginning to wonder whether any bank should base itself in Britain mies of scale: as companies grow bigger, and the difference between good and bad managers becomes starker, the value of good managers soars.

With RBS, the obvious error was to draft a contract which meant a public servant — Mr Hester — could claim a seven-figure bonus at such regular intervals. The blame here lies with the Treasury civil servants who drew up the contract and the Labour government that signed it off. They ought to have realised the huge political sensitivities and simply ensured Mr Hester could have a bonus — an almighty one if need be — payable on RBS’s safe return to the private sector. If the bank were to be sold at a £200 million profit, thanks to Hester’s deft handling, then he could take his seven-figure bonus and ride off into the sunset with the thanks of a grateful nation behind him.

In the next few weeks, Barclays is expected to post massive profits and give a dazzling the spectator | 4 february 2012 | www.spectator.co.uk bonus to its chief executive, Bob Diamond. Under his guidance, Barclays has taken not a penny of shareholders’ cash during the crisis, preferring (to Vince Cable’s fury) to be bailed out by Qatari investors. It has hit its lending targets and is likely to have kept profits at around last year’s £6 billion. About £3 billion is likely to be collected in tax from Barclays and its staff — almost double the annual budget for the Foreign Office. Like all global banks, Barclays has the ability to declare its profits anywhere. Luckily for the British taxpayer, it does so in London.

At the very top of Barclays, however, executives are beginning to wonder if it is wise for any bank to keep its headquarters in Britain in such an atmosphere. Globalisation has brought to London huge companies whose bosses are paid gargantuan salaries. Do we want them? Even hardened capitalists can feel sickened by such extremes of wealth. But tolerating the rich is the price we pay for helping the poor. There are 14,000 people in Britain who are so well-paid that their individual tax bills are around the £1 million mark. Given that they hand most of their earnings over to the government, should they be despised for it?

David Cameron is fond of demanding that the rich pay ‘their fair share’ — his implication is that at present they don’t. But the much-maligned 1 per cent contribute 28 per cent of all income tax collected in Britain, a statistic that ought to comfort the most radical redistributionist. The government seems keener to play to the crowd than it is to protect Britain’s reputation as one of the world’s greatest places to do business. Playing the anti-banker card may boost the Tories’ lead in opinion polls, at least for now. But it will make us all poorer in the long run.

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