Although the UK has already rejected the idea of imposing a cap on excessive bonuses for bank executives, other countries concerned about how best to recover from the recession seem to be giving the idea their support. The French finance minister has already stated that France is ready to launch an "onslaught" against large payouts, and her view has been given support by ministers from other EU countries.
UK Chancellor Alastair Darling is expected to suggest a compromise that bonus payments should be paid out over five years and in the form of share options rather than cash, with the bulk of the bonus being paid in the final two years, and with the possibility that the bonus will have to be paid back if the bank's performance subsequently dips.
It now seems inevitable that the issue of bonus payments to banking executives will dominate the discussions at the G20 summit in Pittsburgh later this month.
- Will the UK be able to withstand the pressure from other countries to impose some form of cap on bankers' bonuses?
- Why do you think that the UK is standing alone on this issue?
- The French Finance minister Christine Lagarde has said that excessive bonuses had contributed to the global financial crisis and needed to be capped to avoid problems happening again. Do you agree with her statement?
- Suggestion for teachers: This debate will inevitably develop over the next month. Use the reports on (e.g.) the BBC website to chart the progress of the UK's view in the lead-up and during the G20 summit
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