Bank bonuses 'not a done deal'


Prime Minister David Cameron has said he is in talks with banks over bonus payments

David Cameron has insisted that he has not given up on efforts to rein in bankers’ bonuses amid public fury over rewards for failure.

The Prime Minister said “detailed discussions” are still going on between the Treasury and major institutions over the scale of their payouts in the wake of the Government’s intervention to prop up the financial system.

And he dismissed as “almost certainly wrong” reports that Stephen Hester, chief executive of the state-controlled Royal Bank of Scotland, could get £2.5 million.

Barclays boss Bob Diamond stoked controversy over bonuses last week when he told MPs that neither the PM nor Chancellor George Osborne had asked him directly to take a reduced sum.

Speaking on BBC Radio 4’s Today programme, Mr Cameron confirmed that he had not had a “specific conversation” with Mr Diamond.

But he added: “We are having really detailed discussions with Barclays, with the other major clearing banks, to try to get a settlement of this whole issue.

“Let me tell you what I want. I want the bonus pools to be lower, I want the taxes that the banks pay to be higher, and vitally I want the lending that they do to businesses – particularly small businesses – in our economy to increase.”

Mr Cameron said the payouts were “not a done deal”, and negotiations would conclude over the coming weeks.

A deal would have to be reached over RBS that ensured “public confidence” was maintained.

Referring to Mr Hester, the Prime Minister said there were contractual issues, but added: “What you saw in the newspapers about the payment he is going to get, that is almost certainly wrong.”

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