Osborne targets bankers' bonuses
Monday, 26 October 2009 12:00 AM
Shadow chancellor George Osborne has called for bankers' bonuses to be limited to just £2,000 in cash, in an "emergency" plan to help Britain recover from recession.
In a speech at Reuters in Canary Wharf Mr Osborne outlined Conservative plans to re-divert bankers' bonuses to help consumers and businesses.
Only £2,000 of bonuses would be payable in cash, although larger amounts would be permitted in shares, under the Tory proposals.
"The banks have to understand we are all in this together," Mr Osborne said, repeating the refrain of his speech to the Conservative party conference earlier this month.
The Conservatives believe up to £20 billion would be made available to boost credit for cash-strapped firms and individuals as a result of the policy.
Mr Osborne argued Barack Obama's administration had seen cash remuneration of the top bankers cut by 90 per cent, adding: "America is acting and Britain is not at the moment."
Earlier he told the BBC Breakfast programme: "You could still pay bonuses, but pay them out in shares in the company, so that if the company does badly you don't get rewarded."
Last week figures confirmed the recession was the longest since records began, with the third quarter of 2009 representing the sixth consecutive quarter the economy has contracted.
GDP growth stood at a negative 0.4 per cent, although government ministers claimed it
would return to positive growth in the final quarter.
Mr Osborne made clear he blamed the government for this failure. He said both "confidence and credit" were lacking in the economy but sought a conciliatory approach to bankers as he did so.
"The politics of envy will play no part in our plans. But we do need the politics of common sense," he said.
"Cash for the economy, not cash for the bonuses. We are all in this together."
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