The Banking industry is going to distribute over £7bn of bonuses this year, while at the same time unemployment has risen, average income is remaining fairly static and inflation is 3.7%, the highest it has been for many years.
This suggests that the banking industry has been very successful over the last 2-3 years, and yet, just over 3 years ago, banks were close to folding and needed hundreds of billions of loans from the UK, US and other governments. The CEO of Barclays said in a Treasury Select Committee that banks should be allowed to fail.
The Deputy prime Minister, Nick Clegg wants business to contribute more to the nation than they currently do, and this is a good idea. It is obviously clear that banking has been a very successful industry, performing far better than the national average and greatly benefiting from the shoring up it received from the UK government.
Bankers are very keen to say that these high incomes are needed to attract the best to work in our banks, and it has obviously worked because the banks are doing so well. The problem is that the national economic problems that we currently have were, to a significant extent, caused by these very same banks - so the question I have is:
Has the UK really benefited so much from the banking industry?
The sector is very quick to remind everyone of the jobs it has created, but what about the damage the sector has caused? How many jobs-losses did the bank cause? How much extra benefits has the Government paid out as a result of these job losses. How much extra money did the Government borrow to keep the economy from crashing?
This would be a fascinating study to review. Let's hope someone does such a study one day.
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