George Osbourne calls for cap on bank bonus cash payments
In a surprising development, Shadow Chancellor of the Exchequer George Osborne has called for a cap on cash bonus payments of £2000. He believes that the UK banking sector should be injecting more money back into the system rather than paying out cash bonuses at a time when businesses are struggling and liquidity is very thin on the ground. So how would this work?
The idea is that with cash bonuses capped at £2000, banks would be able to pay additional bonus amounts using shares which would effectively free up enormous amounts of cash in the short to medium term. The Tories estimate this will increase UK lending by around £20 billion year and while this particular restriction on cash bonus payments would only be a short-term measure, there is a feeling it may well have a positive impact on the UK economy as a whole.
As we approach the next general election it is becoming more and more evident that the Tory party is making plans in the event it may well be voted in as the next government and we are seeing more policies and more ideas released into the public domain. We can expect this to continue in the short to medium term as political parties across the UK begin to ramp up the pressure and attempt to attract voters around the UK.
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