Britain’s Kwarteng plans to end cap on bankers’ bonuses

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Kwasi Kwarteng arrives at number 10 Downing Street, in London, Britain September 6, 2022. REUTERS/Phil Noble

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LONDON, Sept 15 (Reuters) – Britain’s Finance Minister Kwasi Kwarteng is considering scrapping caps on bankers’ bonuses to boost London’s post-Brexit competitiveness against financial capitals like New York and Hong Kong, a source said. source close to Kwarteng’s thought.

Prime Minister Liz Truss has promised to ‘truly free’ the City of London after Britain leaves the European Union and Kwarteng is considering the possibility of scrapping the cap on bankers’ bonuses, originally adopted as a rule of the EU.

The source, speaking on condition of anonymity, confirmed a Financial Times report that the change was being considered, but said no decision had been made.

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An EU-wide cap on bankers’ bonuses was introduced following the financial crash and remains in place in Britain despite the country’s departure from the bloc.

The idea of ​​lifting the caps was considered by former Prime Minister Boris Johnson’s administration in June, but was ultimately shelved. Read more

To reduce criticism of helping wealthy bankers amid a cost-of-living crisis, Kwarteng would place the move in the context of Britain’s recently announced decision to cap consumer energy bills for two years, said the FT. Read more

Truss said she wanted to reduce financial rules inherited from the EU which she said would “hold back the city and its contribution to the whole country”. Read more

Kwarteng is aiming to file a tax return before the end of this month – likely next week – and will likely use it to say how he will deliver the tax cuts promised by Truss during his Conservative Party leadership campaign. Read more

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Reporting by Elizabeth Piper in London, Rhea Binoy in Bangalore; Editing by Lisa Shumaker, Richard Pullin and William Schomberg

Our standards: The Thomson Reuters Trust Principles.

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