Banking: Bonuses

Lord Myners Excerpts

Monday 1st November 2010 Lords Chamber

Asked By

[Lord Myners]

To ask Her Majesty’s Government what action they intend to take to discourage the payment of excessive bonuses to senior executives in United Kingdom banks.

[The Commercial Secretary to the Treasury (Lord Sassoon)]

My Lords, the Government have taken action to tackle unacceptable bonuses in the banking sector. The Financial Services Authority is updating the remuneration code, which will ensure that bonuses are deferred and aligned with the underlying risks, and significant portions of any bonus will be paid in shares or other securities. Employees in this industry will no longer receive all their bonuses in cash while leaving their shareholders, and potentially the taxpayer, exposed to the long-term consequences of the risks they take.

[Lord Myners]

My Lords, the Minister said that the Government have taken action to deal with unacceptable bonuses. Can we therefore conclude that, as far as this Government are concerned, all future bonuses declared are deemed to be acceptable?