Recent regulatory reforms are likely to benefit a few high-earning bankers while doing little for the wider economy.
The High Pay Centre (HPC) has expressed concern over the recent regulatory changes affecting bankers’ bonuses, which shorten deferral periods and adjust the timing and structure of how large bonuses are paid. While some post-crash safeguards remain in place, HPC warns that these reforms risk eroding the protections introduced after the 2008 financial crisis — measures designed to prevent excessive risk-taking and protect the wider economy.
HPC notes that the main beneficiaries of these changes are likely to be a very small number of high-earning bankers, while the reforms offer little positive impact on the real economy. For a government that has criticised its predecessors for relying on trickle-down economics, HPC argues that this move represents more of the same.
The timing of these changes is also out of step with public sentiment. Amid a cost-of-living crisis and rising inequality, where the vast majority of people have faced stagnating living standards while a small minority have prospered, loosening rules for the highest earners risks further eroding public trust.
HPC continues to call for strong, post-crash safeguards to be maintained. Protecting the economy from excessive risk, ensuring accountability in the financial sector, and promoting fairness remain critical for sustainable growth and public confidence.