10 December 2009

ECON Committee Chair tells British Bankers’ Association some banks will have to curb bonuses

MEP Sharon Bowles: ‘Countries have pledged several times their GDP to support banks in order that their economies survive. In the UK, the taxpayer has stumped up around £200bn to help bail out the banks’.

Sharon Bowles, Lib Dem MEP and Chair of the European Parliament's powerful Economic and Monetary Affairs Committee, addressed the British Bankers Association at their annual reception in Brussels on 8 December.

She said: ‘It has been a hard time for bankers recently - it is a hard time for everyone. Across the EU, countries have pledged several times their GDP to support banks in order that their economies survive. In the UK, the taxpayer has stumped up around £200bn to help bail out the banks.’

‘Those of us who have done battle to distinguish, in legislation, between prudence and punishment, have had a hard time too. And of course our work is not finished.’

‘The size of deficits in many countries, including the UK, means that recovery plans will go on for many years - spending will have to be cut. Consequently, long after banks are breathing a sigh of relief and totting up their bonus pools, the public will bear the brunt of these cuts.’

‘It may be daunting for banks to curb bonuses but the issue is not going to go away - enormous bonuses make arguing the case for prudence rather than punishment unbelievably difficult.’

The Economic and Monetary Affairs Committee is currently debating key legislative proposals that seek to protect EU economies in the wake of the credit crunch and subsequent banking crisis.

Sharon Bowles met with European Central Bank President Jean-Claude Trichet yesterday to discuss key items on the monetary policy agenda.

Previous to these statements, Sharon Bowles told Members of the European Parliament: ‘We have to end the current situation in which bankers are making massive bonuses on the basis of low interest rates rather than high skill. Many British banks are now state-owned and it is the taxpayer that is footing the bill for this.’

 

Press release

 

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