Business Secretary Vince Cable has pledged to take “robust action” on the “scandalous” and “completely unjustified” payouts by banks in Britain.
The Liberal Democrat MP vowed to press ahead with plans to curb City worker’s lavish pay and bonuses, despite fears that many financial firms could relocate abroad as a result.
Speaking to the Sunday Times, he said: “The banks shouldn’t underestimate our determination to act. They are deluding themselves, really seriously deluding themselves, if they believe the Government is not going to take this seriously.”
A defiant Mr Cable insisted he would not be blackmailed by bank bosses threatening to move their bases to more favourable tax regimes, passing some threats off as “not credible”.
He also indicated he would accept some firms leaving if it meant a fairer and more stable banking system.
“We’re not going to be bullied. I meet all kinds of companies who say, ‘give us something or we’ll go somewhere else’, but you can’t just give in the whole time,” he said.
“We don’t want to lose firms from the UK. But you’re dealing with internationally mobile companies and some come and some go.”
Chancellor George Osborne and Mr Cable will meet chief executives of the major banks this week for talks in which excessive bonuses and lending to small businesses will be high on the agenda.
Mr Cable said the issue of tackling the culture of secrecy around banking pay would also be discussed.
“We’ve got to have strong disclosure rules: start shining light on what’s actually going on at the top of the leading banking institutions,” he added.