Bank boss bonuses to be curbed

The hefty salaries and bonuses of banking bosses will be curbed under the Government’s new guarantee scheme, Finance Minister Brian Lenihan said tonight.

Mr Lenihan also wants to clamp down on the culture of rewarding reckless lending practices in the sector.

The guarantee scheme, which has been cleared by the EU Commission, is currently being drafted and will be published tomorrow evening.

The protection, covering Irish-owned and foreign-based institutions, is due to be debated in the Dáil on Friday.

Mr Lenihan said of bankers’ pay and bonus schemes: “That is a core issue that will have to be tackled in the context of the new system of banking we are putting in place.”

Speaking at a post-Budget news conference, he added: “There will be a system to ensure that curbs take place in remuneration.

“I’m not going to personally supervise those curbs or decide what the remuneration should be. There will have to be a system to do that.”

Mr Lenihan also defended the Government’s decentralisation scheme which has now been shelved until 2012.

He said 60% of the programme had been implemented since it was announced in 2003.

Today’s Budget also saw four state agencies abolished while dozens of others were merged to cut costs.

The minister added: “One of the big problems with decentralisation was with the agencies who dug in their heels and said ’we are where we belong’.

“We need to make public administration intelligible to the citizen.

“Citizens do not understand the vast number of agencies they have to deal with.

“This has developed in recent decades and it needs to be addressed.”

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