As taxpayer-owned Royal Bank of Scotland announces further job cuts, all while continuing to give its top brass millions in bonuses, the story reads much the same for another UK bank.
On Tuesday (March 3), Antony Jenkins, chief executive of Barclays bank, graciously accepted a bonus that takes his total pay to £5.5m, up from £1.6m last year – even as he presides over a regime that will axe almost 20,000 jobs and close hundreds of branches up and down the country.
To add insult to injury, Barclays, much like RBS, has set aside hundreds of millions to pay out in fines after being embroiled in a rate-fixing scandal in 2012.
In response to his jaw-dropping bonus, the chief executive Jenkins said, “I completely understand that I am very well remunerated for what I do.
“But,” he added, “I think it is appropriate that I accept my bonus.”
No one thought to ask him, however, how “appropriate” it is that more than 70,000 of the bank’s staff are paid £25,000 or less, while a handful earns more than £1m and five people earn more than £5m.
Jenkins defended himself by pointing to the drop in the bonus pool to £1.9bn, down almost a quarter from last year’s pool.
But even the bank itself admits that this fall in bonus payments can be partially attributed to separate allowances being handed out on top of salaries and bonuses – a deliberate attempt to circumvent EU bonus caps.
The news about Jenkins accepting his bonus comes as the Guardian reveals the extent of Barclays’ tax avoidance. In Luxembourg, the fat cats’ favourite tax haven, the bank generated £593m in profits, but employed only 30 people and paid just £4m in tax.
Unite assistant general secretary Steve Turner condemned the shameless way in which banks’ bad behaviour continues despite their promises to reform year after year.
‘Steal candy, go to jail’
“If you steal candy from the shop, you can go to jail in this country,” he said. “But if you fleece billions from innocent people, while rewarding already overpaid suits and ties for what’s essentially criminal behaviour, you’re slapped with a negligible fine and all is forgotten.
“The only way casino capitalism will stop is if it’s made to,” he went on to say. “The banks will not get their house in order on their own. We need tougher banking regulation that has teeth.”
Labour has put forward specific banking reforms, some of which were outlined by shadow minister Cathy Jamieson during last week’s PMQs.
“Bonuses should be a reward for exceptional performance and not a compensation for failure,” she said. “Despite the scandals that have emerged over the past year, most recently HSBC, it looks like this year it looks like this round of bank bonuses will once again be very generous.
“Pay must be more closely aligned with long term performance so a Labour government will embark on a serious and far reaching programme of reform in the banking sector,” she added.
“We will reintroduce our successful tax on bankers’ bonuses which generated over £3bn in 2010. We will act to ensure this tax incorporates any attempts made by banks in an attempt to circumvent the EU bonus cap.”
Meanwhile – even as story after story emerges of banks continuing to operate in much the same way they did prior to the financial crisis – Cameron and the Tories have remained tellingly silent.