Michael Pascoe writes:

Macquarie Bank’s excuse for paying its top
people more than makes sense to human beings is that obscene salaries are the
norm in their globalised investment banking world. The latest UK figures
unfortunately mean they’re telling the truth.

The Guardian is reporting City types
collected an incredible 19 billion quid in bonuses in the latest year. That’s the better part of A$48 billion – more than the
entire British transport budget. The financial services sector accounted for
more than half the total – ten billion pounds worth of bonuses, or some 25,000
knicker for every City worker. And
that’s just the bonuses.

The Office for National Statistics figures
show the bonus payments were up by 2.5 billion pounds on the previous year
which in turn was up 1.5 billion – meaning they have grown by a quarter in two
years. Now that’s what you call wages
inflation.

What makes the scale of the financial
sector bonuses all the more amazing is that the Guardian says Britain’s
banks only made a total profit of 33 billion pounds last year. They’ll do better again
this year, but it seems the Macquarie style of executives first, shareholders second, is common.

Making one small contribution to the bonus
payment surge outside the financial services sector was one James Murdoch. He enjoyed a 23% pay rise to 2.75 million pounds – about $6.9 million
– of which 1.65 million pounds was a bonus payment. There was also the little matter of 382,500
shares worth a bit over two million pounds.

James’s 23% pay rise compares with
BSkyB’s performance of a 1% rise
in pre-tax profits to 798 million pounds on revenue up 8% to 4.15
billion.

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Peter Fray
Peter Fray
Editor-in-chief of Crikey
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