Mr Brown's new war on bonuses

13 April 2012

Fired by the success of his speech in Washington, Gordon Brown today proposes yet more international action on the recession.

However, the target of his speech at the Scottish Labour Party's conference — bankers' pay and bonuses — is ill-chosen.

Mr Brown calls for action on bonuses as part of an international deal to be agreed at next month's G20 summit. He argues that bonuses are based on short-term targets that do not reflect the interests of banks or their customers. It is not hard to see why the Prime Minister is pressing the issue, in the wake of public anger over the pension awarded to former RBS chief executive Sir Fred Goodwin.

Yet this call is no more realistic than Harriet Harman's sabre rattling against Sir Fred. There is no mechanism by which such controls could be imposed domestically, let alone internationally. And if banks, why not the many other businesses who pay their leaders large salaries and bonuses?

If Mr Brown is serious about such measures, they would amount to massive state intervention in the day-to-day decisions of businesses. That cannot be wise, nor will it achieve its objective. And it sits ill coming from a politician who spent most of the past decade loosening controls on banks and, indeed, preaching the gospel of such "light touch" regulation in the EU.

Bankers' remuneration got out of kilter with the results they achieved. But bonuses did not cause the recession, and now the market is beginning to
correct those excesses, as bonuses plunge and bankers lose their jobs.

Mr Brown would do better to justify his thornier decisions — such as today's expected deal with Lloyds Banking Group, increasing the taxpayer's liabilities for its bad debts yet further — than to play a hollow tune about fat cats.

Truth on torture

Our interview today with the family of Binyam Mohamed, the detainee freed last week after seven years' detention by the US, highlights once again ministers' lack of openness over such cases.

Mr Mohamed's family says that he is emaciated and weak: he says he was tortured at bases in Pakistan, Morocco and Afghanistan before spending more than four years at the US Guantanamo Bay camp.

Mr Mohamed's own story is unclear. At best, he appears to have been naive in getting stuck in Afghanistan; US prosecutors allege he received training from al Qaeda. Whatever the truth, the reports of torture made by him and fellow detainees should force ministers to give a full explanation.

The Foreign Secretary, David Miliband, has maintained the official line that Britain does not condone the use of torture. Evidence of British collusion has emerged steadily, however, forcing ministers to change their story.

Last year, the Government admitted that two US "rendition" flights had landed in the UK in 2002, contradicting previous denials; last week, the Defence Secretary, John Hutton, was forced to admit that the UK had handed over two terror suspects to the US in 2004.

The use of torture cannot ever be justified. Yet there is mounting evidence that ministers may have colluded with a policy which, under the Bush administration, made regular use of it. They should come clean about this stain on Britain's reputation.

Custard power

Having things thrown at you is a rite of passage for any politician, although today's attack on Peter Mandelson by an anti-Heathrow demonstrator does seem to be the first involving green custard. Juvenile though such stunts may be, the sang-froid of both hunter and prey said much for British tolerance. Lord Mandelson cleaned himself up while protester Leila Deen simply walked away. The rest of the world has shoe-throwers; we make our feelings known with puddings. We hope Lord Mandelson knows a decent dry cleaner.

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