Labour is urging the Government to prevent Royal Bank of Scotland from paying out bonuses twice the size of bankers’ salaries, as the party prepares to force the UK’s biggest banks to sell off branches to encourage competition.
The BBC reports Labour has tabled a Commons motion calling on the Government – which has an 81 per cent stake in RBS – to reject any request from the bank for bonuses of more than a year’s pay.
Under EU rules, bonuses are limited to one year’s pay, but this can be doubled with shareholder approval.
Shadow treasury chief secretary Chris Leslie says: “At a time when families face a cost-of-living crisis and bank lending to business is falling, it cannot be right for George Osborne to approve a doubling of the bank bonus cap.
“As the majority shareholder, the government should reject any request from RBS to increase the cap. We will put this to a vote in the House of Commons as part of our opposition day debate on the government’s wider failures on banking.”
On Friday, Labour leader Ed Miliband is also expected to flesh out details of a proposal made last year to force the top five high street banks to sell off branches and encourage challenger banks.
The BBC’s Newsnight reported that Miliband may suggest a cap on the size of banks, possibly based on their share of the UK market.