He says the FSA has “pulled its punches, leaving the promises of the Prime Minister and others to curb excessive bonuses absolutely worthless”.
But FSA chief executive Hector Sants says the new regulations on bankers’ pay have not been watered down and that such criticism is “unreasonable”.
Osborne says: “Banks need to be told that the support provided by the taxpayer is there to rebuild their balance sheets and resume normal lending, it is not there to help with mega payouts to bankers.
“This failure to act is further evidence of the need to put an institution with the clout and authority of the Bank of England in charge, and that is what a Conservative Government will do.”
PR firm Lansons public affairs director Ralph Jackson says: “The Tories want to show they are different to the Government and will be tougher.”