The topic on the table is the thorny one of bank bonuses. With so many businesses and families in the UK having to tighten their belts – and not a few wondering how they will pay their heating bills as another bout of cold weather settles in – a winter round of generous big bank bonuses is something the coalition government is keen to avoid.
Mr Cable said at the weekend that the banks needed to show “real restraint and social responsibility” and that the coalition was signed up to “robust action”.
He hinted at the possibility of some form of taxation if necessary but added: “We would rather they (the banks) accepted that they had wider obligations to British business and to the public."
The British Bankers Association (BBA) said the sector "truly understands people's concern over pay" and has made reassuring comments about a “radically different” bonus system that involves locking away much of the payments for several years.
BBA spokeswoman Angela Knight also makes the point that the UK's financial services industry had to compete for business and talented people, adding: "The banks are major employers and pay more tax than any other individual sector, where financial services as a whole contributes £1 in every £10 raised for the Exchequer.”
No doubt that’s fair enough. But given what might be called the “special relationship” between the British taxpayer and the banks – partly based on the role the banks played in shaping our current economic climate and partly on the millions of pounds the government has poured into propping up some of the biggest names of British banking – there are many people out there who might be hoping that it wouldn’t need a meeting with Mr Osborne and Mr Cable to get the banks to do the decent thing.
For more information, please visit www.glazers.co.uk
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