Labour keeps up attack on bonuses
Labour is to step up its attack on the "culture of excessive bonuses" with a warning that bumper City payouts are damaging the economy and wider society.
The party is using an opposition day debate in the Commons to call for large bonuses in banks bailed out by the taxpayer to be paid only when they reflect "genuinely exceptional performance".
Labour strategists are keen to continue to make the political running after Royal Bank of Scotland chief executive Stephen Hester waived his bonus of almost £1 million following a threat by Ed Miliband to put it to a Commons vote.
On Monday senior executives at taxpayer-subsidised Network Rail followed suit and agreed to forgo their bonuses in the face of a political storm over the scale of the planned awards running into hundreds of thousands of pounds. Instead the money will be paid into a fund to improve safety on the railways.
Shadow business secretary Chuka Umunna will use his Commons speech to demand a halt to what he calls the "culture of excessive bonuses" and for greater responsibility in the City and beyond.
He will argue that such lavish payouts have damaged Britain's economy and its society, as well as being bad for business. Labour believes that it has captured the public mood, amid popular revulsion at the perceived excesses of the City at a time of economic austerity.
Shadow chief secretary to the Treasury Rachel Reeves said big bonuses should be taxed more heavily.
She told ITV's Daybreak: "We want bonuses to be taxed properly and, in the last year of the Labour government, we taxed bonuses of more than £25,000 at 50%. We think if we did that again we could bring in £2 billion to help pay for a fund for youth jobs."
Ms Reeves said the pay of people at the top of firms had increased at a far greater rate than those lower down in companies. She added that she would not deny ordinary workers their bonuses.
"For the average person working in a bank branch a bonus for meeting their targets - I don't have a problem with that. But there needs to be much more transparency and that is one of things Labour are calling for today."