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South East MEP Sharon Bowles calls for moratorium on bankers' bonuses

December 9, 2009 3:35 PM

Lib Dem MEP and Chair of the European Parliament's influential Economic and Monetary Affairs Committee, Sharon Bowles, today called for a moratorium on bankers' bonuses in response to Alistair Darling's Pre-Budget Report.

The Chancellor today offered banks a choice - banks can either use their profits to build up their capital base or give out large individual bonuses. He went on to say that bonuses over Β£25,000 will be subject to a one-off 50% tax, to be paid by the bank and not the individual.

Sharon Bowles said: "I am not convinced that the numbers add up and I do not like the muddying of the water between windfall tax and bonus tax."

"If banks really cared about the real economy and the very real financial difficulties many people are facing at the moment, they would not be paying bonuses with profit that has been effectively subsidised by the taxpayer. Instead, those profits should be used to boost capital and to aid lending."

"Right now, many banks are telling me that new, higher capital requirements will damage the economy. It is ridiculous that they define bonus pools in a way that does not take into account the real economic situation and banking capital. Actions speak louder than words - the banks should declare a moratorium on bonuses until there is resolution of new capital requirements."

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