Word has it that Chancellor Kwasi Kwarteng is planning to scrap the caps on City banker’s bonuses. It was always a bad policy, but to do so now as we head into a tough winter smacks of terrible politics. 

Yet there are reasonable arguments for such a move, however insensitive the timing might seem. The new Chancellor is hoping that scrapping bonus caps will attract even more talent to the City rather than see them up sticks to other financial centres like Paris or Frankfurt. Ironically, though, the French have no such qualms about attracting top talent – one of President Macron’s power-grabs since Brexit has been to do all he can to woo nomadic bankers to Paris with big tax incentives. 

What Kwasi needs to do is sell the story rather better, explain that it was the EU that set these bonuses and scrapping them is one of the post-Brexit benefits. Looking at the plan over the long-term, it could even help boost the City’s tax revenues. The City is already the golden goose in terms of raising tax for the rest of the country so a few more feathers to pluck would be no bad thing. 

The new Chancellor and his henchmen need to explain why such an insensitive move would actually help the NHS or levelling-up as it raises more tax for the Treasury. And that it’s not about giving bankers enough money to take their fourth holiday this year. 

Write to us with your comments to be considered for publication at letters@reaction.life