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Banks: Pay

Treasury written question – answered on 3rd February 2011.

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Photo of Gregg McClymont Gregg McClymont Labour, Cumbernauld, Kilsyth and Kirkintilloch East

To ask the Chancellor of the Exchequer what recent steps his Department has taken to reduce the level of executive remuneration in publicly-owned banks.

Photo of Mark Hoban Mark Hoban The Financial Secretary to the Treasury

The Government have taken robust action to tackle unacceptable bonuses. Following agreement in the Capital Requirements Directive, measures taken include the revised Financial Services Authority (FSA) remuneration code, introduced on 1 January 2011 and covering all bonuses payable in the coming bonus round. Further, the new FSA remuneration disclosure rules were also introduced on 1 January 2011, with initial disclosures starting this year and covering remuneration paid in the 2010 financial year. In addition we have introduced the bank levy, higher capital and liquidity requirements, stronger resolution arrangements, the Independent Banking Commission and we continue to investigate the costs and benefits of a financial activities tax.

We have made it clear to the banks in which the Government have a stake that they should have a smaller bonus pool than last year and that they should be a back-marker in the industry.

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