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Government Must Hold Firm on Bankers Pay Cap

Reacting angrily to AIB’s call for banker’ pay to be raised to above a million euro, Joan Burton said that people must not ever forget the price we paid for the foolish decisions and bad management of our private banks. The Labour Party Finance Spokesperson called on the Government, as majority shareholder on behalf of the Irish people, to hold firm on the pay cap on top bankers.

Deputy Burton said:

“It is outrageous for any board of directors to seek to undermine the majority shareholder, but in this case we see institutional shareholders’ views being elevated above the 71% shareholding of the people of Ireland. Clearly, in any organization, the majority shareholder sets company policy, and the Government should make clear that the policy of capping bankers’ pay has not changed.

“The true cost of the bank bailout was not just the direct payments of €64 billion to bail out the banks. Their bad decision-making fuelled the housing bubble and led to the overall economic crash, which ruined so many people’s lives and required the State to borrow tens of billions more until the economy recovered. While we have recovered a small fraction of that cost through selling bank shares, we will never recover the full cost and the banks owe a debt to the Irish people that will last lifetimes.

“AIB bosses may compare themselves to City of London bankers, but they would be better off focusing on providing basic, stable bank services and business lending for the core economy. We neither want nor need our banks to be involved in the risky world of international finance.

“The excessive pay in global financial institutions is part of the problem of inequality that led to the 2008 crash and continues to haunt Europe. We need to stop this inequality, not pander to it.

“Labour unambiguously calls on the Government to veto any increase in pay, bonuses or pensions for top bankers.”