Boris attacks bank bonus cap by EU as harmful to London Boris Johnson today slammed proposals from Brussels for strict new caps on bankers’ bonuses as “a boost for Zurich, Singapore and New York” at London’s expense.
The Mayor’s outburst came after officials agreed that bank bonuses in the European Union should be limited to no more than base salary — or up to twice salary with the explicit approval of shareholders.
But the plan immediately provoked a storm in the City, with senior figures warning it would create a “dumbed down” banking sector that would do huge harm to London’s economy.
The Mayor, who has been one of the few outspoken supporters of the industry during the “banker bashing” years, said: “People will wonder why we stay in the EU if it persists in such transparently self-defeating policies.
“Brussels cannot control the global market for banking talent. Brussels cannot set pay for bankers around the world.”
David Cameron also expressed concern about the proposed rules, saying that any new ones must allow international banks to keep “competing and succeeding while being located in the UK”.
Bank bonuses, which can run to many times base salaries for successful bankers and traders, have fuelled the London housing market over the past two decades.
They have also supported a huge range of businesses, from interior designers to nanny agencies, but have been in steep decline ever since peaking at an estimated £11.6 billion in 2008. This year’s bonus pot in London is expected to be just £1.6 billion, although hundreds of top-performing bankers will still get huge payouts.
Bankers and head-hunters said the proposals could have a massive impact on London’s status as a leading world financial centre.
Carol Leonard of recruitment firm the Inzito Partnership, said: “If this goes through it will only encourage global banks to base their people outside the EU. The global banks can move their HQs at the flick of a switch.
“There are lots of professions and industries that pay far more than 100 per cent of base salaries as bonuses but they are not under such scrutiny as bankers.”
City commentator David Buik of brokers Cantor said: “This is rubbish legislation and will only succeed in driving base salaries up, which is wrong. If this legislation has long-term implications, other financial centres will benefit at London’s cost.
“Frankfurt, Paris, Rome, Milan Madrid, Lisbon, Amsterdam and Brussels are all Mickey Mouse centres in comparison with London. Banking is international and the EU and the UK government need to wake up to that fact.”
The cap deal was struck last night, despite vigorous British opposition, though it is still subject to approval by member state ministers.
Othmar Karas, the European Parliament’s chief negotiator, said: “For the first time in the history of EU financial market regulation, we will cap bankers’ bonuses.
“From 2014 European banks will have to set aside more money to be more stable and focus on their core business — namely financing the real economy of small and medium-sized enterprises and jobs.”
http://www.standard.co.uk/news/mayor/bo ... 14888.htmlUKIP: Cap on bankers' bonuses would 'hurt' workersThe attack on banker bonuses would hurt ordinary workers, UK Independence Party spokesman Godfrey Bloom said today in response to the European Union's move to cap bankers' bonuses.
UK Independence Party spokesman Godfrey Bloom. Credit: Stefan Rousseau/PA Wire
Mr Godfrey said: "This move is the European Parliament getting the boot into bankers for a bit of political pleasure, but it is totally misguided.
"It may give the EU a dirty satisfaction to punish financial people it hates, but this agreement just hurts ordinary workers and the economy in general."
http://www.itv.com/news/update/2013-02- ... t-workers/
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I watched QT this evening and as usual it made my blood boil