Tuesday, 5 March 2013

George Osborne Is Defeated 26 to 1 on EU Bonus Caps

THE DAILY TELEGRAPH: Britain was today defeated after being outnumbered 26 to one over controversial European Union proposals to impose caps on bonuses paid to bankers.

EU finance ministers overruled British opposition to the banking remuneration caps and "technical negotiations" over the detail of regulations to begin next week ahead of a final decision next month.

Michel Barnier, the European Commissioner for financial services, hailed a "crystal clear" deal allowing the EU to impose a bonus limit of 100 pc of salary, or a maximum 200pc after agreement with shareholders, from January 2014.

"The caps are fixed," he said. "These caps will be the basis of our work from now on. All the main points have been approved and will not change."

The caps will also apply to all European bankers working in New York, Hong Kong, Singapore or other overseas branches, again overriding British concerns.

Mr Barnier insisted that the EU was confident that the caps would survive the threat of legal challenges by banks because the legislation specified bonus ratios to existing salaries rather than setting precise ceiling figures for payments. » | Bruno Waterfield, Brussels | Tuesday, March 05, 2013