Labour Seeks Parliamentary Backing for U.K. Bank PlanAndrew Atkinson
Britain’s opposition Labour Party will ask lawmakers to back proposals to force bankers to wait as long as 10 years for bonuses and make “reckless” management a crime.
The party is introducing amendments to financial-services legislation before Parliament, Ed Balls, Labour’s finance spokesman, said in an e-mailed statement yesterday. The move seeks to implement the recommendations of the Parliamentary Commission on Banking Standards, published last month.
A “substantial part” of variable compensation for the highest earners at banks including Barclays Plc and HSBC Holdings Plc should be deferred for as long as a decade to better align the bankers’ interests with those of shareholders, the cross-party banking commission said in its report published June 19. It also demanded a criminal offense for mismanagement, which could see executives of failed banks facing jail terms.
Balls accused Prime Minister David Cameron and Chancellor of the Exchequer George Osborne of “ducking” radical reform of banks by failing to amend the Financial Services (Banking Reform) Bill, which is due to be debated in the House of Commons today, despite having welcomed the commission’s proposals.
Balls said Labour is also demanding that the Treasury be required to publish a report before it begins to dispose of the government stakes in Lloyds Banking Group Plc and Royal Bank of Scotland Group Plc. The report would explain how the interests of taxpayers will be protected and the expected impact on competition, customer choice and the wider economy, he said.
Osborne said last month the government is “actively considering” selling shares in Lloyds, though privatizing RBS is still some way off. The Treasury is examining the case for breaking up RBS and hiving off its worst-performing assets into a bad bank.