Revealed: Thousands of Britain’s top bankers become Euro millionaires while workers pay clipped to 1 per cent

HSBC pic credit BBC

HSBC. Five senior executives due to share £33.4m Pic credit: BBC

CROSS POSTED ON BYLINE.COM

The day  after the general election the House of Commons library released a flood of papers which had been held up because of  purdah rules until after the result was known.

One of the most revealing papers was one on Banking Executives’ Renumeration in the UK. It drew on two sources – Britain’s submission  ( required by EU rules ) to the European Banking Authority and British sources such as company reports and details from the banks themselves about long term incentives for senior executives.

The facts revealed in the annexes to this report confirm what a lot of people have suspected but have not always been able to prove. There is-a widening gulf between the top and the bottom that has been going on during the fiercest period of austerity which has seen real wages for million falling. If John McDonnell, the shadow chancellor, and Jeremy Corbyn, the Labour leader, had access to this information during the election it could have been dynamite.

Two facts are extraordinary. This boom in higher executive pay came under the coalition between 2012 and 2015 when David Cameron and George Osborne were actively pursing wage freezes and minimal wage rises in the public sector.

Second it is the scale of it – it is not a handful of  new bankers becoming Euro millionaires, it is thousands of them.

And for the very, very top executives at five of our biggest retail banks it is untold riches if they meet performance targets.

The wider picture only came out because of a  European Commission directive to collect figures from all 28 EU members on how many bankers are earning over 1 million euro (£884,300 at current rates) a year. At the time the Euro would have been worth less – but even so it is a large sum.

Britain will no longer have to supply this when we leave the EU.

The figures show startling increases in senior staff employed by the banking industry falling into this bracket between 2012 and 2015 across nearly all sectors. Altogether the number of higher earners has risen nearly 300 per cent over this period, from 1272 to 3551.

Among the bigger rises are those in investment banking where the numbers earning this figure and more has risen from 947 to 2146. In asset management the numbers rose from 94 to 415 while those in high street banks rose from 52 to 105.

The average salary among the 2146 top earners in investment banking was 2,021,000 euro or over £1.78 million a year. Among the 415 people in asset management it was even higher at 2,201,000 euro or £1.946 million a year. In retail banking the 105 people averaged a little less at 1,789.000 euro or £1.582 million each a year.

Equally damning is a survey taken from five banks in Britain – HSBC, Barclays, Lloyds, Santander and the state owned RBS.

It looked at the money the five to eight top executives could make. At Lloyds 8 people share £24.9 a million a year between them. The figure for Barclays was £27.1m and at HSBC the top five people shared a whopping £33.4m.

Figures for the state owned RBS are lower at £11.35m while at Santander it was £10.6m.

As already known the chairmen and chief executives also get good pay packets worth millions.

What this says is that the coalition of David Cameron and Nick Clegg were happy to preside over this boom and impose severe austerity, and job cuts to pay for the mess the very same bankers created  by triggering the  crash in 2008.

As the song goes : “It’s the poor what gets the blame, It’s the rich what gets the pleasure, Isn’t it a blooming shame? ”

For not much longer I suspect given the current climate.

I have written about this in Tribune magazine. The House of Commons library report is  here for those who wish to read it

 

 

 

 

Should £1 bn of unclaimed pensions, shares and insurance policies be used to alleviate austerity?

Rob Wilson

CROSS POSTED ON BYLINE.COM

Just before Christmas the government  that promised a ” bonfire of the quangos”set up a new one.

It is called the Dormant Assets Commission and it is unusual in that every member of the quango is a wealthy business person.

Not surprisingly there was little coverage of this body. But the government itself provided a lot of information about what it would do and who was sitting on it. I have written about it in last week’s Tribune magazine.

It has been given a year to scour the financial markets to find unclaimed stocks and shares, pensions, bonds and insurance policies which have not been claimed for more than 15 years.

The quango, set up by the Cabinet Office, follows on the work of identifying dormant bank accounts which led to £850m being distributed to good causes by the Big Lottery Fund since it was set up by the last Labour government in 2008.

The decision on who will get the new money however will depend on Cabinet Office ministers who are making it clear that it is likely to go to charities which are replacing services provided by local government and the state.

Minister for Civil Society, Rob Wilson said:

“More than a billion pounds of assets, that might otherwise sit gathering dust, will go into funding for charities that make a real difference to people’s lives across the country.

“To build an even more caring and compassionate country we need to transform dormant resources and give the funds to those who need it.”

The commission is entirely staffed by business people – many global players – under the chairmanship of Nick O’Donohoe, chief executive officer of Big Society Capital until the end of last year and a former head of global research for bankers J P Morgan.

The business people aiding him are Richard Collier-Keywood, PwC Global vice-chairman; Kirsty Cooper, group general counsel and company secretary, Aviva plc;Gurpreet Dehal, former chief operating officer Global Prime Services, Credit Suisse;Rachel Hanger, partner, KPMG; Jackie Hunt, non-executive director, CityUK and member of the Financial Conduct Authority Practitioner Panel; Mark Makepeace, group director of information services, London Stock Exchange Group and chief executive of FTSE Group; Susan Sternglass Noble, senior advisor to the Investor Forum; and Martin Turner, group business risk director, Lloyds Banking Group.

Richard Collier-Keywood was the head international tax expert for PriceWaterhouseCoopers advising international companies on global taxation.

Rachel Hanger from KPMG is also another international tax adviser for hedge funds providing what her biography describes as “pro tax advice” to fund managers.

Mark Makepeace is the man who co-ordinated the “big bang” deregulation at the London Stock Exchange and runs his own global index business. He is the only one of the new appointments who declares any interest in charities, having been a long-standing supporter of Unicef.

To my mind the present Conservative government is pursuing a pretty nasty policy of cutting services. But should it make up the shortfall by grabbing other people’s assets and employ wealthy people skilled in tax avoidance to find them.

And how will ministers spend other people’s money. Will  the ” sofa style ” government of Tony Blair be replaced by the ” dinner party ” style of government by David Cameron and George Osborne distributing other people’s assets to their mates favourite charities or services in Tory marginal seats.?I am deeply suspicious of this venture and we are entitled to know more about it.