Liz Truss - the first 100 days....

[Craig the cyclist]

You clearly cannot or will not understand that a cap, in this instance, refers to a cap on bonuses in relation to basic salary in an attempt to minimise the taking of risks, as has happened in the past.

It was not a cap put on as a means of arbitrarily reducing their earnings but to minimise risk taking.

This discussion will go around in circles as long as you do not understand the basic principle of the cap.

Bringing in all those other jobs is, and I am sorry for repeating this word, specious, but it is the ridiculous tactic you resort to every time. There is absolutely no similarity with the circumstances surrounding " bankers" bonuses, and you must know that.

Of course I understand how it works.

The point is that the banker will take whatever risk is needed to get the maximum bonus, no matter if that is 10%, 50% or 100% of salary. The risk taking will not reduce, it's simply the banker who will get less money, pay less tax and move abroad to a country where there is no cap, so the UK will lose the tax take.

 

[deptfordmarmoset]

It appears that the plan to scrap the cap on bonuses is at least partly to try to fight the diminished status of the UK finance industries. There has been a significant movement of financial institutions towards Europe, most notably the Netherlands. And this is largely the result of our oven ready Brexit, which has weakened the UK sector through the loss of things like ''passporting'' rights in the EU.

It's significant that EU countries are able to attract erstwhile UK institutions without removing the bonus cap of 1, and increasingly 2 x, salary. It's just that Brexit has squandered the UK finance sector's exceptionally strong position within the EU. The EU now looks like a far more stable environment to do finance in.

 

[Deleted member 49]

The approach you always take is to not answer the question. I ask how much they should be paid, you don't give a figure which means you can always say 'It's too much'.

I am not in favour of a nurses pay cap, if a nurse can negotiate a £500,000 salary then go for it. No cap on anyone's pay is my approach, if you can sort it then good for you.

Now, I have answered your question. Try and answer mine, how much should the banker be allowed to earn?

Yawn....

 

[Craig the cyclist]

Yawn....

that will be a no then.

Why do you find it so difficult to put a simple number to a simple question? I don't understand it. You accused me of not answering a question, which I clearly answered.

I ask you a simple question and your student politics brain can't cope with it can it? Come on, how much, in your world, should bankers be allowed to earn? Or is the answer £15 an hour like a shelf stacker in a supermarket or a temp in an office who doesn't know anything about the job yet?

 

[matticus]

He's gotcha there Adam!!!!!

 

[Deleted member 49]

I ask you a simple question and your student politics brain can't cope with it can it? Come on, how much, in your world, should bankers be allowed to earn? Or is the answer £15 an hour like a shelf stacker in a supermarket or a temp in an office who doesn't know anything about the job yet?

That's better Craigy...you are cutting if you try I'm almost offended lol.
Where's the shortage of people wanting to be senior bankers ? There wasn't many vacancies last time I looked on Indeed ?
It's irrelevant what I think they should be payed.Its up to the banks/employers isn't it ? This is about bonuses.But you knew that didn't you ?
Just for you,to ease your pain I can't say I value them that highly 🙄

 

[icowden]

The point is that the banker will take whatever risk is needed to get the maximum bonus, no matter if that is 10%, 50% or 100% of salary. The risk taking will not reduce, it's simply the banker who will get less money, pay less tax and move abroad to a country where there is no cap, so the UK will lose the tax take.

It's an interesting point but most experts would seem to disagree with you.

But research into banking bonuses suggests caution, with evidence of a direct relationship between “variable executive remuneration” (performance dependent bonuses) and risk taking. In the US for example, it has been found that bank CEOs with pay incentives linked to risk took on higher levels of risk in the run up to the financial crisis. And financial firms where pay levels rewarded a short-term approach were more exposed to subprime credit risk and performed poorly during the crisis.

So by limiting the amount of the bonus, you avoid very high risk taking which is what caused the banking crisis in the first place.

Truss wants to lift the cap to attract bankers back to the UK. They didn't leave because of the bonus cap. 43% of the largest UK financial institutions moved at some or all of their business to Europe where they can work freely with 27 countries, and have relationships with many more countries through existing EU trading relationships.

So, in the short term Truss may entice some senior bankers back to the UK, but there is a very great attendant risk that they will trigger a banking collapse.

A better solution would be to enter into a free trade relationship with the EU so that goods and services can move freely as they did before.

 

[PaulB]

Craig the Cyclist was posting on this thread last night after 10pm and he's been posting from just after 8am this morning. Is this his full-time job? I rarely read what he has to write because it's never worth the effort but the time he spends on it is a bit worrying.

 

[Fab Foodie]

It appears that the plan to scrap the cap on bonuses is at least partly to try to fight the diminished status of the UK finance industries. There has been a significant movement of financial institutions towards Europe, most notably the Netherlands. And this is largely the result of our oven ready Brexit, which has weakened the UK sector through the loss of things like ''passporting'' rights in the EU.

It's significant that EU countries are able to attract erstwhile UK institutions without removing the bonus cap of 1, and increasingly 2 x, salary. It's just that Brexit has squandered the UK finance sector's exceptionally strong position within the EU. The EU now looks like a far more stable environment to do finance in.

This^^^

 

[Craig the cyclist]

Craig the Cyclist was posting on this thread last night after 10pm and he's been posting from just after 8am this morning. Is this his full-time job? I rarely read what he has to write because it's never worth the effort but the time he spends on it is a bit worrying.

Oh come on @PaulB, you read everything I write and you know it

Anyway, we never got to the bottom of your wife's pay, is she an 8a by any chance? I just wondered if she is going to be impacted by the impending pay rise that isn't in the NHS for three of the pay bands? My partner is, she contacted her union rep, RCN as you ask, and was told that the rep wasn't interested as she earns 'a huge whack already' (I appreciate that is probably just one reps view and not the view of the whole union)

 

[ebikeerwidnes]

Not sure if anyone has made this point before - apologies if they have

But if 'the bankers' are being paid large salaries and the massive bonuses are being capped - which is the concept

Then the banks will find some other way to compensate/reward them
however, if we remove the cap then they will, presumably, revert to just being paid huge bonuses in money again

so - lets assume that a 'banker' gets £1,000,000 a year - and for whatever reason, good or not - they get a 200% bonus over and above what they are currently allowed
That is £2,000,000 extra paid to them

which is taxable - at the higher rate

now I have no idea how many of these 'bankers' are involved or how much the 'bonuses' are worth but if they are anywhere near the headlines claim then it is a lot of tax going into the Treasury

OK - not a huge amount compared to the amount being paid to reduce energy costs - but it is a lot

ANyone seen any actual figures on this?


BTW - I put 'banker' in quotes because the exact job title seems inaccurate and appear to include the person behind the counter at the local NatWest - which is not the case.
So I use the quotes as I presume there are a lot of jobs title involved
and not because I want to use a different first letter

 

[jowwy]

Craig the Cyclist was posting on this thread last night after 10pm and he's been posting from just after 8am this morning. Is this his full-time job? I rarely read what he has to write because it's never worth the effort but the time he spends on it is a bit worrying.

what business is it of yours what his job is??? try teaching your grandkids manners, before talking about others

 

[Rusty Nails]

Of course I understand how it works.

The point is that the banker will take whatever risk is needed to get the maximum bonus, no matter if that is 10%, 50% or 100% of salary. The risk taking will not reduce, it's simply the banker who will get less money, pay less tax and move abroad to a country where there is no cap, so the UK will lose the tax take.

The only cause of banker exodus I have seen was some initial movement to the EU (who still have a bonus cap), after Brexit which has now virtually stopped.

I would beinterested in the statistics you have showing that they are leaving in droves because of the cap. Or are you just making that up as well?

 

[Beebo]

Rees Mogg just stood up In parliament and called anyone who opposes fracking a Luddite.

The Tory MPs are giving him a very hard time. As they all stood on a manifesto of no new fracking.

 

[BoldonLad]

I'd much prefer progressive taxation that automatically redistributes a large percentage of those bonuses.

Governments picking certain industries for windfall taxes and caps on bonuses strikes me as tinkering and fraught with cries of unfairness.

Agreed, not to mention the law of unintended consequences