David Cameron Will Not Cap RBS Bonuses But Will Veto Rise in Pay

David Cameron has refused to back a cap on bankers’ bonuses at Royal Bank of Scotland and instead has pledged to limit overall pay at the taxpayer-owned institution.

He was challenged by the Labour leader, Ed Miliband, to stop bankers getting paid multimillion-pound bonuses as high as their multimillion-pound salaries, but dodged the question during his weekly prime minister’s question time on Wednesday.

In a return to the usual insults after a subdued session last week, Cameron hit back by claiming Miliband had “all the moral authority” of the Rev Paul Flowers, the disgraced Co-op banking chief, given the last government’s record on banking regulation.

The prime minister said the government would retain a £2,000 cap on cash bonuses for bankers and refuse to allow the overall pay bill to rise. But he was silent on limiting bonuses given out in shares.

“We will continue with our plans for RBS that have seen bonuses come down by 85%, that has seen the bonus pool at one third of the level that it was under Labour,” he said.

Labour sources said the pledge not to increase overall pay was meaningless as RBS had reduced in size by around 2,000 staff and would naturally pay out less than last year.

via theguardian.com

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza