A 90% tax on banker bonuse: who could object?

Not the Daily Mail.

Who’s scared of the bankers? I mean, it can’t be any worse than Deal or No Deal, surely?

We could get Noel Edmonds on the phone to these guys…

Would he be any worse at it?

Truly the drunks are running of the brewery, the vampires are in charge of the bloodbank, the lunatics have taken over the asylum…

The Morning Star reports:

Labour MP John McFall tore into Prime Minister Gordon Brown in Parliament on Thursday over obscene bonus payments to bankers.

Mr Brown went along to a question and answer session with senior MPs hoping to fob them off with a tame document suggesting a few feeble banking “reforms.”

But the terrier-like Mr McFall made Mr Brown squirm, telling him: “I put it to you, Prime Minister, that the horse has bolted.”

He instanced the average bonus of half a million pounds each for bankers at Goldman Sachs announced just this week.

The West Dunbartonshire MP, who is chairman of the Treasury select committee, protested that the recent £9.6 million pay package for Royal Bank of Scotland chief Stephen Hester “is very similar to Cristiano Ronaldo’s contract at Real Madrid.”

He added: “The City has won. Like Ronaldo, they are running rings around both the government and regulators.”

Mr McFall demanded that Mr Brown must act to make sure that ordinary citizens can “trust the banks” and get a “fair deal from the banking system.”

Pale with tension, Mr Brown could only fall back on his prepared brief as he faced Mr McFall and other members of the Commons liaison committee in the Boothroyd Room in Portcullis House.

The Prime Minister agreed that “excess payments” to bankers were “unacceptable.”

Then he added weakly: “It is only on the basis of long-term performance that we can guarantee the bonus system.”

He said that an interim review of banking governance published on Thursday recommended that “bonuses and remuneration should be over a five-year period.”

Mr Brown stressed that there also needed to be “proper transparency” and a regulatory system “to take action where necessary.”

Thursday’s review was drawn up by City bigwig Sir David Walker – who was director of Lloyds Bank between 1992 and 1994.

He urged that non-executive directors of banks should be “better informed” and actually attend to company duties a bit more often. He suggested they spend “up to 50 per cent longer” at the bank.

Bonus schemes should include a “significant” deferred element to discourage short-termism, he added.

His wishy-washy report said: “Many boards inadequately understood the type and scale of risks they were running and failed to hold the executive to high standards of sustainable performance.

“Bonus schemes contributed to excessive risk-taking by rewarding short-term performance. And shareholders failed to exercise proper stewardship.”

Mr Brown told the MPs’ committee that Sir David “makes some very clear recommendations which I believe will be adopted.”

Tory MP Edward Leigh asked him whether there was any truth in press reports of plans for 20 per cent cuts in public spending.

Mr Brown dismissed this as “quite ridiculous,” but then added that “there are tough choices that have to be made.”

He said that £9 billion of cuts were being made in back-line public services “so that we can increase spending in front-line services.”

And he confessed that extra spending on the Iraq and Afghan wars had amounted to £14bn.

Let them eat guns!

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One Response to “A 90% tax on banker bonuse: who could object?”

  1. Economic crisis, workers resist | Dear Kitty. Some blog Says:

    […] Labour MP John McFall tore into Prime Minister Gordon Brown in Parliament on Thursday over obscene bonus payments to bankers: here. […]


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