Senior UK bankers will get bonuses years earlier under plan to relax rules
Senior UK bankers will receive their bonuses years earlier under plans by the Bank of England to relax post-financial crisis restrictions.The proposals are to reduce the bonus deferral period for some of the most senior bankers from eight years to five.Less senior bankers would get their bonuses after four years, in a further relaxation of the restrictions.Bankers would also be able to receive some of their bonus in the first year, instead of having to wait until the third year.In the EU, bankers’ bonuses are typically deferred for three to five years, while the US has no such restrictions.
Sam Woods, the chief executive of the Bank of England’s Prudential Regulation Authority (PRA), said: “These proposals on bankers’ bonuses will support UK growth and competitiveness without undermining financial stability,We should not return to the very dangerous pay structures that were commonly in place before 2008, but these proposals will reduce bureaucracy and support responsible risk-taking,”A year ago, the UK scrapped the banker bonus cap, removing one of the key reforms introduced by the EU in the wake of the 2008 financial crisis to discourage excessive risk-taking,Since 2014, banker bonuses had been capped at two times their annual salaries,The PRA and its sister regulator the Financial Conduct Authority (FCA), which are behind the relaxation of the rules, argue that the reduced bonus deferral periods provide enough time for any problems to surface.
They should also help reverse a trend whereby banks have raised the amount of fixed salaries, which are not dependent on performance, rather than bonuses, which can be cut or clawed back.The proposals, first floated by Woods last month, strongly encourage firms to tie bonuses closer to not just the successes of executives, but also any risk-management failures, according to the PRA and FCA, by introducing clarifications to existing policies to ensure firms consider adjusting pay when things go wrong.The regulators also want to remove EU-originated guidelines that prohibit paying dividends or interest on deferred bonuses awarded in shares or other instruments, and require senior bankers to wait up to a year before being able to sell deferred bonuses in shares or other instruments.Sarah Pritchard, the executive director for consumers, competition and international at the FCA, said: “These important changes will remove unnecessary duplication of rules between the regulators, streamline the remuneration regime for firms, and further strengthen the reputation and competitiveness of the UK banking sector.”The new rules would also reduce the number of bankers subject to rules on their pay, and give companies more discretion to determine which employees will be subject to the rules.
The consultation closes on 13 March.Sign up to Business TodayGet set for the working day – we'll point you to all the business news and analysis you need every morningafter newsletter promotionEarlier this month Rachel Reeves told the FCA that it should encourage more risk-taking across the City as part of the chancellor’s pro-growth strategy.The High Pay Centre thinktank said: “Huge bonuses for bankers impose costs on banks’ clients in the real economy as well as incentivising risky and destabilising behaviour, so excessive pay awards in the financial services industry matter to all of us.“A deferral period of five years for the most senior banking executives is still a long time to wait so the PRA’s proposals are not unreasonable, but shorter deferral periods should theoretically lead to lower payouts - bankers are likely to apply less of a discount to the value of awards they can access sooner, so a smaller bonus deferred for five years has more value as an incentive than a larger one deferred for eight years.“If this doesn’t reduce the size of payouts, it will be yet another sign of the dysfunctional governance of bankers’ pay and more evidence supporting the case for regulation.
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Mass advertising campaigns on assisted dying spark anger among MPs
Mass advertising campaigns on assisted dying, including billboards at Westminster station and targeted Facebook adverts, have sparked anger among MPs.Amid an increasingly fractious debate on assisted dying before a vote on Friday, MPs have raised concerns about “inappropriate” tactics used by both camps.MPs have objected to a billboard campaign featuring terminally ill patients promoted by Dignity in Dying, which is in favour of the legislation. One MP said the billboards, some of which have been covered by Samaritans posters, were inappropriate in a tube station.Meanwhile, Care Not Killing, one of the main groups campaigning against assisted dying, has used photographs of more than 50 MPs in Facebook adverts targeted at voters in their constituencies
Is the China-US fentanyl pipeline really responsible for the US opioid crisis?
Donald Trump has said that his favourite word is tariff, which he describes as “the most beautiful word in the dictionary”.So his announcement on Monday that he would be imposing 25% tariffs on imports from China, Mexico and Canada was perhaps to be expected. He also separately outlined “an additional 10% tariff” on imports from China, which – even if enacted – would be well below the 60% rate that Trump had threatened on the campaign trail.More surprising is the US president-elect’s claim that the tariffs are a response to China’s failure to curb the flow of fentanyl into the US.“I have had many talks with China about the massive amounts of drugs, in particular fentanyl, being sent into the United States – but to no avail,” Trump wrote
Whistleblowing doctors need better protection | Letters
We are encouraged to note that Wes Streeting is taking serious steps to stop NHS managers persecuting whistleblowing doctors just because they have raised patient safety concerns (NHS bosses who silence whistleblowers face sack under government plans, 24 November). The unwarranted and widely publicised detriments to some doctors who have spoken up about safety matters over the past 20 years have had serious consequences, despite laws intended to protect them. Trusts must be banned from dismissing doctors who raise patient safety concerns, and obliged to investigate their concerns, which at present are frequently covered up.The employment tribunal system, which some doctors may forlornly engage with to save their careers and livelihoods, is heavily biased against them. If dismissal was banned, most of the massive legal costs borne by the taxpayer would be avoided
Share your experience of buying weight loss jabs privately in the UK
Weight loss jabs like Wegovy and Mounjaro are becoming increasingly prevalent in the UK, and are available from many online pharmacies – including those run by high street companies. Yet concerns have been raised over whether these medications are being advertised or promoted.We’d like to hear from readers who have purchased these jabs privately, to discuss how you chose the pharmacy and your experience of adverts.You can tell us about weight loss jabs you have bought and any adverts you have seen by filling in the form below.Please include as much detail as possible
‘Deaths of needless poverty and despair’: homelessness report reveals surge in fatalities in Australia
Almost 1,500 people are dying in homelessness every year, with new research from the Australian Institute of Health and Welfare showing a 63% surge in preventable deaths.The Australian Institute of Health and Welfare today released an analysis of a decade of data, showing 12,500 people who had accessed homelessness services died over the 10-year period to 2022.The death rate of those people was 1.8 times the general population, and the annual death toll rose from 914 in 2012-13 to 1,489 in 2021-22 – a 63% increase.While over half the deaths (46%) in the study period were people aged 35-54 years, over 1 in 10 (or 1,500 in total) were people aged 25-34 and 1 in 100 (160 total) were children under 14
Assisted dying could have major impact on courts, says ex-chief justice
A former lord chief justice has warned that assisted dying could have a major impact on the court system, saying “no one has grappled with the detail” of the impact of the legislation on family courts.Lord Thomas of Cwmgiedd, who held the role between 2013 and 2017, told BBC Radio 4’s Today programme that the process of the assisted dying requests coming before the courts needed “working out precisely.”The private members’ bill from Kim Leadbeater has safeguards including sign-off from a high court judge.Proponents of the bill have argued that the process can be done swiftly, as is the case with some terminal cases and life support requests currently, but say it will also be rigorous and include the potential to hear from doctors, the patient and their families.Thomas told the Today programme: “It seems to me that the one really difficult question that hasn’t been addressed in this is how is the judge to proceed, as it cannot possibly be a rubber stamping exercise
Walmart to phase out DEI initiatives amid escalated attacks from conservatives
Female executive directors in FTSE 250 down 11% since 2022
FCA fines Macquarie Bank £13m for fictitious trades amid ‘serious failings’
UK prices for car repairs and electrical goods expected to rise due to budget
Philadelphia workers at Amazon’s Whole Foods file for first union election
Trump’s talk of tariffs raises fears of hit to economies worldwide