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Banks: Pay

Volume 487: debated on Thursday 12 February 2009

To ask the Chancellor of the Exchequer if he will make it his policy to (a) prohibit the payment of bonuses to staff of those banks in which the Government has a majority stake and (b) review the levels of remuneration packages awarded to those staff at the end of 2009. (256502)

As part of their investment, the Government have agreed a range of conditions with banks accessing the recapitalisation scheme, including restrictions on bonuses for senior executives—both for 2008 (when the Government expect no cash bonuses to be paid to board members) and for remuneration policy going forward, where incentive schemes will be reviewed and linked to long-term value creation, taking proper account of risk. In the future remuneration packages should reflect long-term sustainable success and not simply short-term gains.