TAXPAYERS have become almost inured to Royal Bank of Scotland racking up losses and running up costs since the Edinburgh-based lender was bailed out at the height of the financial crisis. But even by Royal Bank’s dismal standards, the £2.55 billion bill it has rung up over the Williams & Glyn debacle is somewhat eye watering.

The state-backed lender was ordered to dispose of the branches by the European Commission as a condition of its £45 billion bailout by the Treasury in late 2008 and early 2009.

Now, having failed to find a buyer for the Williams & Glyn network, the Treasury has put together a deal that would allow Royal Bank to hold on to the branches. That would involve the bank spending a further £750m on proposals aimed to boost competition in the UK banking sector.

Royal Bank had aimed to clone its banking platform and launch Williams & Glyn as an independent challenger bank. And it spared no expense to execute this plan: up to 6,000 staff, mostly contractors, were drafted in, with work given to about 300 outside agencies.

The process began in 2010 but in August the bank, led by chief executive Ross McEwan, called it to a halt as concern over risks, costs and complexity reached breaking point. The impact on margins from lower-for-longer interest rates was also cited.

Yet, despite years of hard work and expense, it appears Royal Bank is back at square one over Williams & Glyn. It is not just the bank that has questions to answer. Why did UK Financial Investments, the body that looks after taxpayers’ stakes in the state-owned banks, let the ultimately doomed process carry on for so long?

That the project dragged on for years is surely not acceptable husbandry of public money.

The challenges should not be disregarded. But taxpayers are entitled to ask why the project, which has seen billions of pounds of public money spent with nothing to show for the outlay, was allowed to rumble on for so long. If the process was going to be as complex and costly as the bank eventually conceded, why was it not stopped sooner?

It is not hard to imagine that many millions of pounds of taxpayers’ money could have been saved had a different approach been taken.