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| Bankers' deals could be 'torn up' | Bankers' deals could be 'torn up' |
| (30 minutes later) | |
| Alistair Darling has said the Financial Services Authority will be given powers to "tear up" bankers' contracts if pay deals reward unnecessary risk-taking. | Alistair Darling has said the Financial Services Authority will be given powers to "tear up" bankers' contracts if pay deals reward unnecessary risk-taking. |
| The chancellor told The Sunday Telegraph bankers had to see themselves as "fellow citizens" who had been bailed out by the taxpayer. | The chancellor told The Sunday Telegraph bankers had to see themselves as "fellow citizens" who had been bailed out by the taxpayer. |
| The culture should change, with no rewards for practices which had brought the banking system down, he said. | The culture should change, with no rewards for practices which had brought the banking system down, he said. |
| The Financial Services Bill will be part of the Queen's speech this week. | The Financial Services Bill will be part of the Queen's speech this week. |
| In it the government will outline its remaining legislation between now and the general election in 2010. | In it the government will outline its remaining legislation between now and the general election in 2010. |
| We will ensure that the banking crisis we have experienced over the last two years should never again come at a cost to the taxpayer Prime Minister Gordon Brown | We will ensure that the banking crisis we have experienced over the last two years should never again come at a cost to the taxpayer Prime Minister Gordon Brown |
| Ministers believe that getting tough with bankers will underline the government's commitment to a fairer Britain and create more dividing lines with the Conservatives, said BBC political correspondent Iain Watson. | Ministers believe that getting tough with bankers will underline the government's commitment to a fairer Britain and create more dividing lines with the Conservatives, said BBC political correspondent Iain Watson. |
| Mr Darling has confirmed that he will legislate to give the City watchdog, the Financial Services Authority (FSA), the power to stop bankers from receiving excessive bonuses and to cancel any pay packages which appear to reward undue risk-taking. | Mr Darling has confirmed that he will legislate to give the City watchdog, the Financial Services Authority (FSA), the power to stop bankers from receiving excessive bonuses and to cancel any pay packages which appear to reward undue risk-taking. |
| The measures being outlined this week will apply only to future contracts. | The measures being outlined this week will apply only to future contracts. |
| Business minister Lord Myners said: "We are going to make it clear that contracts which add bonus clauses that will add to risk or contracts that will generate bonuses for risk-takers are no longer acceptable. | |
| He added: "We are not capping bonuses... What we are doing is ensuring that bankers no longer have bonuses in place that contribute to an excessively risky system." | He added: "We are not capping bonuses... What we are doing is ensuring that bankers no longer have bonuses in place that contribute to an excessively risky system." |
| Last month the Conservatives said High Street banks should temporarily be banned from paying staff bonuses of more than £2,000 a year in cash. | Last month the Conservatives said High Street banks should temporarily be banned from paying staff bonuses of more than £2,000 a year in cash. |
| The party says this would free up to £20bn which could then be lent to businesses and consumers. | The party says this would free up to £20bn which could then be lent to businesses and consumers. |
| Following Mr Darling's announcement, a Conservative spokesman said ministers had "endlessly chased headlines" on bankers' bonuses. | Following Mr Darling's announcement, a Conservative spokesman said ministers had "endlessly chased headlines" on bankers' bonuses. |
| A spokesman said: "The real issue that they have not addressed is that the tri-partite system of banking regulation has failed and we need to put the Bank of England in charge of regulation. | A spokesman said: "The real issue that they have not addressed is that the tri-partite system of banking regulation has failed and we need to put the Bank of England in charge of regulation. |
| "There is a growing international consensus that it is right to have central banks in charge of regulation." | "There is a growing international consensus that it is right to have central banks in charge of regulation." |
| 'Living wills' | 'Living wills' |
| In a podcast on the Downing Street website Prime Minister Gordon Brown promised a "transformation" of the way the financial sector was policed. | In a podcast on the Downing Street website Prime Minister Gordon Brown promised a "transformation" of the way the financial sector was policed. |
| Mr Brown also said Britain had a "bright future" ahead of it after the economic difficulties of the past year, predicting a coming period "not of austerity but progress". | Mr Brown also said Britain had a "bright future" ahead of it after the economic difficulties of the past year, predicting a coming period "not of austerity but progress". |
| The UK had fared well in terms of jobs and repossessions compared with the last recession in the early 1990s, he said. | The UK had fared well in terms of jobs and repossessions compared with the last recession in the early 1990s, he said. |
| Legislation to be unveiled on Wednesday would enable the FSA to require banks to renegotiate remuneration packages that breached its pay code, and fine those that continued to offer unjustifiable sums. | Legislation to be unveiled on Wednesday would enable the FSA to require banks to renegotiate remuneration packages that breached its pay code, and fine those that continued to offer unjustifiable sums. |
| Mr Brown said: "We will ensure that the banking crisis we have experienced over the last two years should never again come at a cost to the taxpayer." | Mr Brown said: "We will ensure that the banking crisis we have experienced over the last two years should never again come at a cost to the taxpayer." |
| Alistair Darling said the banking culture needed to change | Alistair Darling said the banking culture needed to change |
| The new rules would come into effect next year if the bill completes its passage through Parliament before the election. | The new rules would come into effect next year if the bill completes its passage through Parliament before the election. |
| Other provisions would require banks to hold larger capital reserves and to prepare so-called "living wills" to ensure they could be wound up in the case of failure, without putting the entire financial system at risk. | Other provisions would require banks to hold larger capital reserves and to prepare so-called "living wills" to ensure they could be wound up in the case of failure, without putting the entire financial system at risk. |
| Mr Darling dismissed suggestions that the bill amounted to an incomes policy for banks which would drive financial services companies abroad. | Mr Darling dismissed suggestions that the bill amounted to an incomes policy for banks which would drive financial services companies abroad. |
| "We want this to be a good environment where firms from all over the world come and do business. But part of that is to make sure that there is a tough supervisory and regulatory regime." | "We want this to be a good environment where firms from all over the world come and do business. But part of that is to make sure that there is a tough supervisory and regulatory regime." |
| The bill would also bar financial institutions from encouraging customers to borrow more than they can afford by sending out unrequested credit card cheques. | The bill would also bar financial institutions from encouraging customers to borrow more than they can afford by sending out unrequested credit card cheques. |
| And it would allow bank customers to join forces in class actions to demand compensation for excessive bank charges. | And it would allow bank customers to join forces in class actions to demand compensation for excessive bank charges. |
| Should the FSA have the power to "tear up" bankers' contracts? Do you work in the financial services? You can send us your views and experiences using the form below: | Should the FSA have the power to "tear up" bankers' contracts? Do you work in the financial services? You can send us your views and experiences using the form below: |
| The BBC may edit your comments and not all emails will be published. Your comments may be published on any BBC media worldwide. Terms & Conditions | The BBC may edit your comments and not all emails will be published. Your comments may be published on any BBC media worldwide. Terms & Conditions |