George Osborne spends £43,000 of taxpayers’ money defending bankers’ bonuses

The chancellor George Osborne has spent over £43,000 of taxpayers' money defending bankers' bonuses, according to new figures.

George Osborne nc1j

The bonus cap restricts bankers’ bonuses to 100 per cent of their pay, or 200 per cent with shareholder approval

The chancellor George Osborne has spent over £43,000 of taxpayers’ money defending bankers’ bonuses, according to new figures.

A response from the Treasury to a Freedom of Information request by Labour shadow financial secretary to the Treasury Cathy Jamieson has revealed that the total cost of external legal fees relating to the legal challenge to the bankers’ bonus cap and connected advice is £43,064.

But the true cost to the taxpayer is likely to be even higher as the figures are only for the external legal costs of the challenge and do not include the cost of civil servants who worked on the case.

The bonus cap restricts bankers’ bonuses to 100 per cent of their pay, or 200 per cent with shareholder approval.

George Osborne lodged a legal challenge with the European Court of Justice on the bonus cap in September 2013 but the move was abandoned in November 2014 when Osborne said it was “unlikely to succeed”.

Commenting on the news, Cathy Jamieson MP said:

“While working families face a cost-of-living crisis, it is astounding that George Osborne chose to waste taxpayers’ money fighting a bank bonus cap.

“His decision revealed his true priorities and showed just how out of touch he is.

“It shouldn’t have taken the EU to act to rein in excessive bonuses, but George Osborne has totally failed to act here in Britain.

“Labour will reform the banks and levy a tax on bank bonuses to fund a paid starter job for young people out of work for over a year.”

19 Responses to “George Osborne spends £43,000 of taxpayers’ money defending bankers’ bonuses”

  1. cjcjc

    Tax on bonuses 45%
    Tax on profits 21%
    Down with bonuses!

  2. Gary Scott

    Money well spent. The taxpayers take all the risks and bail out the banks, the bankers get the rewards when the good times roll and golden handshakes when they don’t. Socialise risk, privatise profit! How selfless of George

  3. swat

    At £1000 an hour these top lawyers charge, its about 5 days work in all. Cheap at the price.
    But there is no defence for those bankers with their noses in the trough, as Osborne had to admit. So it should come out of his pocket. The man is an oik.

  4. CGR

    Anything that keeps the City at the top of the global financial system is to be welcomed.

    Just think about how taxes would have to go up for everyone if the City of London lost its pre-eminence and its tax receipts it earned fell !!!

  5. blarg1987

    The city itself has recieved a large volume of subsidies from the taxpayer via low interest loans from the bank of England for well over the last decade, this has been a main contributor to its “success”.

    If such a function was removed then overall taxes probably would not change or it would be very small difference over the money the exchequer gets in revenue vs the amount we pay out in subsidies to the city.

  6. littleoddsandpieces

    So Labour will use up most of the tax on banker’s bonuses on the admin of a tax on the richest people who can afford to pay for an accountant to globalise their personal finances and avoid the tax.

    It is sad to me that The Greens have not the moral courage to put into their
    2015 manifesto a couple of policies that will save countless lives
    of the poorest people, in or out of work,
    from suicide and starvation
    from the first day it begins, and
    save billions from benefits admin.

    A recent blog showed that the DWP’s last 6 monthly report showed that it spent
    £7.7 billion on admin costs in 2013/14, actually spent only £4.3 billion on Jobseekers allowance to help people with food and fuel money with no other income.

    Most of the admin spent being on 1 million benefit sanctions leaving people to starve.

    This includes DWP salaries and contracts to private providers.

    What The Greens offer would mean no reason for much of the billions wasted on DWP admin, none of the private contractors and no need of the 750 Jobcentres employing 78,000 staff, leaving people equally to starve from nil benefit, even just before Christmas, someone 60 and disabled or a heavily pregnant young woman or mother with new baby.

    Further over £1 billion is spent on private contractors fees for employment programmes, whilst the unemployed are bullied into working for no salary at all for 6 months on workfare. The only slavery in history where the slave must pay from pitiful low money of benefit for transport, clothes, food, and all household bills.

    The Greens will not put out on billboards after voting them into their 2015 general election manifesto that would win them at least 13 million voters of the poor of all ages
    (according to Oxfam) in or out of work:

    – universal and automatic Citizen Income, in or out of work makes no difference, to replace all the cruel benefits regime, to the level of the basic tax allowance

    – Full State Pension to all citizens, irregardless of their National Insurance contribution / credit history, to the same or higher of the Citizen Income.

    Both of the above would have a supplement for those living alone and for those who are disabled.

    The new pensioners lives are saved by these policies that The Greens have failed to put in their 2015 manifesto yet, especially,
    of women born from 1953 and men born from 1951
    who fall victim
    to the flat rate pension
    that actually give huge numbers NIL STATE PENSION FOR LIFE and
    for bulk of rest LESS NOT MORE state pension

    https://you.38degrees.org.uk/petitions/state-pension-at-60-now

  7. Leon Wolfeson

    The imbalance and long-term damage must continue, right.

  8. Leon Wolfeson

    As much money as the city needs, quite.

  9. Guest

    Then the greens would make the poor spend all the cash they were given on basic utility access. Whoops!

    Keep the copy/paste ranting going though.

  10. Leon Wolfeson

    So Labour will institute a system where it’s in business interest to keep unemployment high, and drop wages by having lots more minimum wage jobs for young people.

    Sigh.

  11. ForeignRedTory

    ;Just think about how taxes would have to go up for everyone if the City
    of London lost its pre-eminence and its tax receipts it earned fell !!!’

    Just think about how taxes for everyone could be slashed if the City of :London could be taxed properly.
    Let’s have an Value Added Tax on financial transactions.

  12. Godfrey Paul

    And allow uncontrolled immigration so that the continual supply of labour keeps wages down just like they did for the 13 years to 2010.

  13. Leon Wolfeson

    Keep pushing your myths, as you try and close the border on the 99% and trade, so you can drop wages dramatically. Given your system would have far higher unemployment than Labour is pushing you are being a screaming hypocrite.

    Everything for you is clearly about your hate of the Other. Never mind the topic being discussed, and you need to make everything about your hate.

  14. wildcolonialboy

    This story is bunk. Osborne is 100% wrong on his position on banker bonuses, but “Government spends money defending government policy” is not a story. As the elected government they are entitled to spend money on legal advice in support of their stated policies.

    Either criticise the policy itself or take a step back.

  15. JoeDM

    Yep. Good point. We need to make full use of our comparative advantages and international finance is a major one.

  16. Guest

    Ah yes, your 1%’s “comparative advantage” over the 99%.

  17. Brendan Caffrey

    Taxing Wealth: A
    Modest Proposal

    The fear of a “tax bombshell” in newspapers before
    next May inhibits any political party from open discussion. But an innovative
    reform of taxation might get popular support; even for some tax increases.

    Recent support for a radical change, involving a shift
    from taxing income to taxing wealth, has emerged. The first outing was called a
    “mansion tax”. This was a tax on large private houses. One objection to this
    was that it left the council tax bands on property unchanged since 1991. This
    means that the large recent increases in the value of housing have produced a
    situation where all houses valued at above £320.000 are taxed at the same rate.
    So house worth millions of pounds are taxed as if they were valued at £320.000.

    A simple solution is to increase tax rates in new
    bands up to say £5 million. In France a rate of 75% has just been abolished
    because it raised less tax than expected; and chasing tax avoiders fleeing to
    other countries increases the cost of tax collection. This punitive rate would
    also be very unpopular in Britain.

    An alternative would be a tax on all capital assets.
    This is a tax on wealth in all its forms, large holdings of capital in banks,
    hedge funds, capital transfers gifts and inheritances. This would take much of
    the responsibility away from income tax, for raising state revenues. Income tax
    could be reduced overall. But a more complex set of bands could be introduced
    that did not have equal sizes. So, at the bottom there could be the greatest
    relief. At the middle there would be less relief than at the bottom. Above the
    middle relief could be reduced but by smaller amounts the further one rises to
    say the French maximum of 75%. This 75% would only apply to very few extremely
    rich people. As the numbers here are so small the cost of chasing non payers of
    tax would be small compared with France.

    On this system the poor would pay much less, the
    “squeezed middle” would pay a little less, and the very rich much more. This
    could be popular, even to many voters.

    There would be still residual problems chasing the
    movements of liquid cash. But many forms of investment have time limits, and
    are less easy to move out of the country.

  18. sarntcrip

    IF TORY BOSSES DID NOT IMPORT CHEAP LABOUR TO BOOST THEIR PROFITS THERE WOULD BE VIRTUALLY NO PROBLEM OOPS SORRY HIT CAPSLOCK

  19. Norfolk29

    How naive you are. George is one of them and when he leaves politics he will join them. On the board of some financial institute or other.

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