Huffpost UK Politics

Clegg Warns RBS And Lloyds Over Bonuses

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Nick Clegg's Speech To Demos Has Been Widely Trailed Over The Weekend
Nick Clegg's Speech To Demos Has Been Widely Trailed Over The Weekend

Nick Clegg will renew warnings to state-owned banks not to consider awarding "irresponsible" annual bonuses this year or face intervention by the Government.

His promise of "no let up" on the issue will form part of a speech designed to set out a distinct Liberal Democrat "open society" vision amid testing times for the coalition.

While he will claim some common ground with the Tories, the Deputy Prime Minister will sustain his weekend assault on his power-sharing partner's proposed tax break for marriages.

And he will let rip at eurosceptics for putting "narrow national interest" above "enlightened internationalism" - pledging the UK will "re-engage" with EU partners on a range of issues.

UK politics and economics is "distorted by unaccountable hoards of power, wealth and influence", he will say - in the media, lobbying, the City and boardrooms.

Turning on the banks, he will add: "I understand the anger that people feel at the bonuses still flowing to bankers, especially those who have been bailed out by the taxpayer. If we are serious about tackling wealth inequality, serious about responsible capitalism, serious about ensuring everyone contributes fairly to the Government's coffers, then we cannot be neutral on this issue.

"We took a tough line on bank bonuses last year, particularly in the banks where the Government is the biggest shareholder. We ensured that the bonus pools in RBS and Lloyds shrank, that all bonuses paid to chief executives and executive directors were entirely in deferred shares, not in cash and that a limit of £2,000 was placed on cash bonuses.

"The profound impact of the banking implosion on our economy, and on our society, has since become even clearer. There has been no lessening of public anger towards the banks - and there will be no let-up in the Government's determination to keep the clamps on bonus payments.

"So, on the eve of bonus season, let no-one be in no doubt about our determination to use our clout as the major shareholder in these banks to block any irresponsible payments, or any rewards for failure."

Mr Clegg said the Tories' proposed tax break for marriage was not only philosophically objectionable but also unlikely to influence people's decision anyway.