Bank of England slates 'bonus culture'
Thu 1 May 2008
01/05/2008
The Bank of England has criticised the City's bonus culture and warned its salaries are draining talent from the market. Mervyn King, governor, told the Treasury Select Committee banks are partly to blame because they reward huge risk with huge reward. "I do think it is rather unattractive that so many young people when contemplating careers look at the compensation packages available in the City and think that these dominate almost any other kind of career," he said. According to the Office for National Statistics and data from Morgan McKinley, financial salaries averaged £49,765, double the mean wage for 2007. The director general of the Confederation of British Industry is in agreement with Mr King. Richard Lambert said bonuses reward success but do not penalise failure, it was reported. Some employees may favour set pay-scales as they can make it easier to budget month-by-month.
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