George Osborne tried to protect bankers’ bonuses – the EU said no

The chancellor has been beaten back by the EU after arguing a cap on bankers’ bonuses was illegal.

George Osborne had been attempting to overturn the EU’s limit for bonuses of 100% of a banker’s salary, or 200% if shareholders agreed to it.

However, a senior legal advisor at the European Court of Justice rejected Osborne’s argument.

The chancellor had wanted changes to how bankers were paid, arguing salaries would increase to take into account the limits of the bonus cap. He said he wanted powers to be able to claw back salaries as well as bonuses from unscrupulous bankers.

He said: “I’m not going to spend taxpayers’ money on a legal challenge now unlikely to succeed. The fact remains these are badly designed rules that are pushing up bankers’ pay not reducing it. These rules may be legal but they are entirely self-defeating, so we need to find another way to end rewards for failure in our banks.”

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Readers' comments (2)

  • Your headline is misleading. His argument is that the cap will lead to much higher base pay and so will be counter-productive. His suggestion of powers to claw back salaries and bonuses would be much tougher than merely capping a bonus!

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  • Anonymous

    This guy said we needed the welfare cut, but goes out and spends our taxpayers money to protect the rich banksters bonuses, while quick loans online are all we've been left. His arguement will be that they put their bonuses into helping get the economy going. Thats a laugh they put it straight into havens like the rest of the rich who have had their tax cuts since the tories took power and the libdems helped them sell a profit making postal service.

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