- 10 updates
The Mayor of London has attacked European Union plans to cap bankers' bonuses, warning it would play into the hands of London's overseas rivals while undermining support in Britain for the EU.
Labour Treasury spokesman Chris Leslie has said the European Union's move to cap bankers' bonuses should have been "driven by George Osborne", and that the Government had been "dragging its heels" over banking reforms.
Othmar Karas, the Austrian member of parliament part of introducing a cap on bankers' bonuses in the European Union has said the proposal was to bring in "fairness and responsibility" into the industry.
The attack on banker bonuses would hurt ordinary workers, UK Independence Party spokesman Godfrey Bloom said today in response to the European Union's move to cap bankers' bonuses.
Mr Godfrey said: "This move is the European Parliament getting the boot into bankers for a bit of political pleasure, but it is totally misguided.
"It may give the EU a dirty satisfaction to punish financial people it hates, but this agreement just hurts ordinary workers and the economy in general."
RBS chief executive Stephen Hester has told ITV News' Economic Editor Richard Edgar that the European Union's decision to cap bankers' bonuses should not be targeting the industry.
Mr Hester said: "Why just one industry? What other industries do you want caps on and income policies, then you have the question of does your economy then thrive based on that central control?"
Trade union Unite has attacked RBS chief executive Stephen Hester for not backing the proposed EU cap on banker bonuses.
Hester has warned that a proposed cap on banker bonuses will chase “economic activity ... to where the playing field is more favourable".
The Confederation of British Industry (CBI) has hit out at European Union proposals to cap bankers' bonuses at a year's salary.
Michael Noonan, Ireland's finance minister, has talked up the EU’s proposed financial reform package, which includes a cap on banker bonuses.
Noonan, who led the negotiations for the 27 governments in talks last night, said: "This overhaul of EU banking rules will make sure that banks in the future have enough capital, both in terms of quality and quantity, to withstand shocks.
"This will ensure that taxpayers across Europe are protected into the future."
London Mayor Boris Johnson has attacked EU plans to cap banker bonuses.
He said: "People will wonder why we stay in the EU if it persists in such transparently self-defeating policies. Brussels cannot control the global market for banking talent. Brussels cannot set pay for bankers around the world.
"The most this measure can hope to achieve is a boost for Zurich and Singapore and New York at the expense of a struggling EU.
"This is possibly the most deluded measure to come from Europe since Diocletian tried to fix the price of groceries across the Roman Empire."
David Cameron has insisted that European regulations need to be flexible enough to allow UK-based international banks to proser.
European Union officials last night struck a deal to cap bankers' bonuses at a year's salary.
Under the deal, which the UK opposes, some bankers may still earn twice their salary in bonuses if there is explicit approval from shareholders.
Speaking in Riga, Cameron said: “What we do have in the UK – and not every other European country has this – is major international banks that are based in the UK but have branches and activities all over the world.
“We need to make sure regulation put in place in Brussels is flexible enough to allow those banks to continue competing and succeeding while being located in the UK.
“We will look carefully at the outcome of the negotiations [in the European Union] before working out the approach we will take at Ecofin next week.”