Bankers’ bonuses are a real soap box issue for me. I find the whole notion absolutely infuriating. Look at this excerpt from a Times article back in January:
RBS’s boss, Stephen Hester, said last week that he had to pay bonuses, which will cost the bank an estimated £1.5 billion, to stop bankers leaving for higher rewards at rival institutions — an argument that prompted the former Times editor Simon Jenkins to complain that bank bonuses were “the most outrageous contempt of democratic authority in modern times”, and inspired the singer-songwriter Billy Bragg to announce that he was going to stop paying taxes. When asked by MPs how he was going to face the public backlash, Hester remarked “I thought I might go on holiday for a long time”. But does he have a point? Isn’t it true that RBS would bleed staff if it didn’t dish out millions?
Frankly, I am sick and tired of being patronised by banks and financial institutions (although I acknowledge that not all are the seame). We are told “Oh but you have to be exceptionally clever to work in a financial institution.” Clever at what exactly? Let me explain…
A couple of years ago, a financial institution offered me a 110% mortgage to buy a tiny flat in a not very nice area. They advised me that it was a really good idea. Common sense told me that it was an utterly ridiculous idea. Immediate negative equity.
A financial institution persuaded my Granny to let them invest her money in an almost ‘no risk’ (as they put it) fashion. They lost 10K for her in the process.
Bank charges. Need I say more? A letter is generated automatically by a computer and costs you £28 in admin, along with a £35 charge. There is no admin involved here, it is a computerised process. It is not in their interest to put in a system to have your card stopped when there is not enough money on it (I believe electron did though?), nor is it in their interest to have an online system that is up to date. Consequently you can end up being charged when your bank says you put in money before the chargeable amount left your account. Fair? I think not. They simply say “But you should know how much is in your account”. Oh yes, so I should. Remind me why an online system exists then? I will stick to pen and paper shall I?
So, I am told that the bonuses system is thus… If you have a banker who makes millions for the bank, why would you not pay him a bonus of half a million? He deserves it. This sounds logical (although I hope he is taxed mercilessly for it) but the real question is, HOW has he made millions for the bank? Has he taken pensioners like my Granny and ripped them off at every hurdle? Has he been ungracious with bank charges? Or is it all about greed?
Imagine my attitude of “colour me surprised” when RBS announced today yet another batch of job losses (now 20,000 since the bail out). The government bailed them out to the tune of an extortionate amount of money rendering them 84% owned by the tax payer. The tax payer sponsored bonuses of 1.5 billion and will now be sponsoring those left on the dole as a result.
Who deserves a bonus? I think of nurses, who are on their feet for long night shifts caring for critically ill patients. Nurses are not paid enough for what they do. “But it takes a special sort of person to be a city banker”. Forgive me if I present you with a disdainful expression.