A Warwickshire hotelier is set to lose thousands of pounds after under-fire bank managers bowed to pressure and cancelled their Christmas party.

Up to 240 workers from the Royal Bank of Scotland’s Brindleyplace office in Birmingham were due to attend a festive bash at Nailcote Hall in Berkswell.

But after comments from a Birmingham MP, bosses have decided to call off the event 12 days before it was due to happen on December 13.

Hotel owner Rick Cressman hit out at RBS - which has recently been subject to a multi-billion pound government bail-out - for breaking its contract and MP Gisela Stuart for criticising ‘extravagant spending’.

He said: “I am thoroughly annoyed. The net result of Ms Stuart’s comments are that the Christmas party for RBS staff has been cancelled.

“This was quite a normal Christmas party, not a lavish affair as it was described. What is so abnormal about £49.50 which the staff had agreed to contribute to?

“No Champagne had been ordered by RBS, just house wine, and hotel rooms had not been booked by the company. Individuals had the option to book their own rooms at a special rate.”

Nailcote Hall - a 17th century property with 40 bedrooms, leisure club, conference facilities and a nine-hole golf course, was told on Monday that the event would not go ahead.

The bank will lose out on the deposit handed over to the venue and faces a compensation claim for damages due to the termination of the contract.

But Mr Cressman said it was unfair on both RBS staff and his employees and said the party should be allowed to go ahead because it was organised prior to the government bail out.

He added: “As far as I am concerned it’s despicable that a Labour MP should create intimidatory pressure on management to cancel the party that staff had chosen to contribute to and which would have benefited charity.

“Furthermore RBS entered into a contract with Nailcote Hall. It is not my position to say whether they should have a Christmas party or not but we had an agreement and a Government owned company has broken that which I believe is without good reason.

“The most upsetting thing is that I have 16 staff expecting to work on December 13, mostly young people, many students who are expecting to earn money just before Christmas and they won’t as a result.”

RBS confirmed that managers decided to cancel the Christmas party following adverse publicity.

The bank dismissed claims bosses had agreed to spend thousands of pounds, saying the event would raise money for charity and that it had offered to provide its standard £10 subsidy per head.

But Ms Stuart, said RBS had made another mistake by cancelling the party.

She said: “It was wrong for Royal Bank of Scotland to have done this in the first place. If now they are now inappropriately cancelling a contract then in my view it is a double wrong.

"They have a responsibility to everyone and that includes suppliers. What I don’t think is inappropriate is to pass their mistake to someone else.”