Thursday, 14 October 2010

Businesses Not Bonuses

Nick Leeson was jailed for six and a half years for what today's bankers receive obscene bonuses for - namely bringing our banks to their knees.

This morning on Radio 4's Today programme, Barclays Bank Chief Executive, John Varley opined that most people wouldn't consider the expending of 15% of a business's total costs on bonuses unreasonable.

Well that's where you're mistaken and completely out of touch with public feeling Mr Varley. During a recession where the majority of British employees are suffering pay freezes, pay cuts and even worse, job losses, many of us feel that ALL bonuses are grossly insensitive and ought to be frozen indefinitely at the very least, particularly in the banking sector largely responsible for the economic black hole we now find ourselves in, and which taxpayers have been forced to bail out, so consequently we expect some gratitude and favours in return, in addition to seeing performance-related pay implemented.

As for the old chestnut that you 'can only recruit the top people by paying top banana', for all the good the 'top people' have done, a bank may as well let the janitor loose on the system to have a go. At least the janitor is more likely to consider the customer and the consequences of his actions and is less likely to be motivated by blind avarice.

Even the Royal Family during World War II recognised that it was politic to announce they were going to be consuming the same food rations as their subjects at the Palace which, whether a short-term gesture of support for their subjects or otherwise, contributed greatly to the public morale at a time when it was besieged from all directions. The Royals were never so popular indeed.

The banks do not even have the decency to make a gesture such as suspending bonuses or lending to small businesses and the demolition of our once proud nation goes on.

I urge everyone who feels as I do to vote with their feet and close any accounts with the big 4, taking their business to a smaller or more stable bank. I myself defected from the Royal Bank of Scotland to Smile internet bank (the online version of the Co-Op bank) nearly 10 years ago now. It was easier than getting a new credit card and banking regulations have long prevented your old bank making it harder for you than a tearful pleading phone call. Whilst my interest rate with Smile has sadly plummeted over the years to become as poor as the big 4, at least I have the comfort of knowing I am supporting an otherwise ethical and stable enterprise, and one which does not send me any junk mail or spam whatsoever.


Tessa said...

Good for you, Laura: that's what I call putting your money where your mouth is. If there's one lesson we have learned from the financial meltdown it is that bankers are totally amoral. Here in Canada, they're all holier than thou, patting themselves on the back for not getting caught up in the maelstrom. No mention, of course, of the fact that they have bitched, moaned and whined non-stop for the last ten years over government regulations preventing them from sinking their trotters into the same trough as the American banks.

Steve said...

Well said that woman! If anyone in this country deserves a bonus it's you, Laura.

Wisewebwoman said...

I am totally sick of the banks, Laura, even though far too many of my family are involved on a direct basis. I can't believe the plundering they have now visited upon the so-called "third world".
And the bonuses and lifestyles are staggering.

Geoff said...

I moved from Barclays to the Co-op in the late 70s because of Barclays' involvement in South Africa. Never had any problems with the Co-op.

Owen said...

The pox on big banks who act like casinos... Amen, Laura, amen...

(not that I'm religious or anything like that...)

urko said...

Coincidentally, I am sat here watching the Michael Moore film "Capitalism: a love story"

But it makes depressing watching.

That geezer from Barclays is clearly out of touch - but there are enough deluded thrusting aspirational Daily Mail readers (oops) in this country to ensure that nothing will change in a rush.

The Sagittarian said...

Indeed, we left one of the 'bigger' banks some years ago and now bank with the only NZ owned bank with no problems and brilliant service! We fully expect the Tory government we've got to try and sell the bank now that most NZers bank with it!!