New EU bankers bonus rules come into force

Arlene McCarthy

The new European law tackling bankers’ bonuses will come into force tomorrow (1st January 2011).

The draftswoman behind the new Law on Bankers Bonuses and Vice Chair of the European Parliament’s Economic and Monetary Affairs Committee Euro MP, Arlene McCarthy is calling on George Osborne to come before the House of Commons and explain the implementation of the law and its impact for the 2011 bonus round.

Arlene McCarthy MEP said: “It is in the public interest for the Chancellor to explain to MPs how the Government will implement these new rules. This is particularly important as the Government spent the last month trying to waterdown the rules and hesitated implementing them for the 2011 bonus round.

“In the United Kingdom alone over 720 Billion Pounds of support was made available to failing banks, more than an entire year's spending by the Government.  These new rules are designed to put an end to the excessive risk taking culture that led to the global financial crisis.

“The UK Government has been forced to accept the law and failed in its attempts to weaken the rules. My proposals cut up front cash bonuses and are essential to remove the incentives for excessive risk taking that led to the banking crisis.”

“The banks have had two years since the 2008 financial crisis to do this and have failed to act, so now this law has done the job for them.”

"We have seen bank chiefs walk away from the ruins of their firm with a 16 million pound bonus pot, while taxpayers pick up the bill. These new rules will ensure this can never happen again."

“The Government must reassure the public that it will implement these tough bonus rules in full.”