Banker bonuses drop to £7bn, new research shows

5 October 2010

Bonuses for bankers in 2010 will fall to £7 billion from last year’s £7.3 billion, new research has revealed.

A study by the Centre for Economics and Business Research (Cebr) showed that HMRevenue & Customs (HMRC) will now receive more than bankers from the bonus pay outs.

City workers are expected to receive £3.8 billion while the taxman will get £4.1 billion.

According to Cebr, bonus pay outs will be “significantly lower” than the £11.6 billion distributed in the City during 2007.

The fall is due to a smaller amount of workers in the sector and a decline in the size of the average bonus.

Benjamin Williamson, Cebr economist and co‐author of the research, said: “Our research shows that the public coffers stand to gain considerably more from city bonuses than city workers themselves.

“To be frank, this finding is quite timely because it seems that the wave of public anger towards bank bonuses may be ebbing a little.”

“A whopping £7billion bonus payout will be easier to stomach if the lion’s share goes to the nation,” he added.

The 50 per cent tax on banker bonuses of more than £25,000 is expected to raise £3.5 billion for the government.

By Jim Ottewill

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