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Lloyds bank bonuses will be "limited"

Gordon Brown has today used his weekly press conference to highlight an agreement with the board of Lloyds bank which will see bonuses "limited" in the short term. The government has promised to "agree a fair package for staff" which would reward them for their efforts by limiting the substantial bonuses we have seen in the UK banking sector of late. However, when you consider that Lloyds bank is set to receive a second tranche of UK taxpayer's funding, is there really a reason to pay bonuses this year?

Yet again there is speculation of more "spin" on the side of the government as the Royal Bank of Scotland situation has been revealed in full today with suggestions of up to £600 million of deferred bonuses currently being discussed. Even though these deferred bonuses would be in the form of Royal Bank of Scotland bonds, they will still ultimately be a cost to the taxpayer as and when they are exercised in the future.

The problem the UK government has is the fact that many UK businesses outside of the banking sector have fallen by the wayside due to a lack of credit and support from the banking industry. Where are the wages for these companies? Where are the bonuses for these employers? Where is the funding from the UK banking sector, which has been bailed out by taxpayers time and time again?

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