Quote:Anger over Barclays' plans for Diamond's bonus

Bank in discussions with government over lending targets and bonus restraint while expectations grow of an £8m payout for chief executive

Jill Treanor
guardian.co.uk, Friday 4 February 2011 22.34 GMT


Bob Diamond, chief executive of Barclays, after appearing before the Treasury select committee last month Photograph: Ben Stansall/AFP/Getty Images

Barclays was tonight accused of making a mockery of attempts to call a truce with the government over "banker bashing" amid fresh expectations that its chief executive Bob Diamond would be awarded a bonus of at least £8m.

After months of talking with the banks, the coalition is yet to announce a deal, codenamed Merlin, under which the industry would to agree lending targets of up to £190bn and show restraint on bonuses in return for less criticism from the government.

The talks with the banks have been led by Diamond's predecessor John Varley and tonight Lord Oakeshott, a Liberal Democrat treasury spokesman, appeared to suggest the bank was making a mockery of those discussions.

"Barclays are shaking hands with government over project Merlin while holding up two fingers to the country with the other," Oakeshott said.

The banks and government are trying finalise the level of lending commitments and find a way to make them enforceable. The government is also keen to secure a promise from the banks to provide more detail about how much their highest-earners are paid. Talks are ongoing over Hong Kong-style disclosure rules under which banks such as HSBC are already required to provide the total pay of their five highest-paid staff.

Currently UK banks only have to provide information on pay of bankers who have a seat on the board.

Unions were also angry, as both David Cameron and Nick Clegg have promised to extract a show of restraint from the banks.

Len McCluskey, Unite general secretary, said: "If this bonus story is accurate Bob Diamond and his chums in the City again make blatantly clear their arrogance in awarding themselves bumper bonuses. They continue to ignore the devastation their banks have brought to this country and the government continues to allow them to laugh all the way to the bank.

"Nobody is fooled by Cameron and Clegg's empty promises of reining in these greedy bankers. They are busy slashing essential public services, while these bosses continue to enjoy their lavish lifestyles."

Last month, at his first appearance before the Treasury select committee of MPs, Diamond had called for end to the attacks on bankers that have been commonplace since the 2008 financial crisis and the bailout of Lloyds Banking Group and Royal Bank of Scotland. The American banker, who has spent more than a decade at Barclays running the investment bank Barclays Capital, had said that the period of remorse and apology was over. He became chief executive of the bank at the start of 2011 and is due to present the bank's profits for 2010 on 15 February.

Any deal on Merlin is expected to be announced before then, as the banks could then publicly confirm their lending targets and commitments on bonuses alongside their results. Tonight Barclays would not comment on the size of any bonus awarded to Diamond and insisted no decision had been taken.

The Chancellor George Osborne and business secretary Vince Cable have both been involved in the talks. Osborne may be hoping for a solution before facing questions on Treasury matters on Tuesday.

David Guyatt Wrote:Unions were also angry, as both David Cameron and Nick Clegg have promised to extract a show of restraint from the banks.

Len McCluskey, Unite general secretary, said: "If this bonus story is accurate Bob Diamond and his chums in the City again make blatantly clear their arrogance in awarding themselves bumper bonuses. They continue to ignore the devastation their banks have brought to this country and the government continues to allow them to laugh all the way to the bank.

"Nobody is fooled by Cameron and Clegg's empty promises of reining in these greedy bankers. They are busy slashing essential public services, while these bosses continue to enjoy their lavish lifestyles."

Quote:"Nick Clogg, the deputy prime minister, is a "mercurial and untrustworthy" figure, obsessed with flamenco dancing and horseracing, racked by phobias, and unable to travel anywhere without a "voluptuous" Ukrainian nurse on whom he is entirely dependent, according to a top US diplomat who conceded that his notes may have got mixed up during a recent transfer from Tripoli, though he added that he "was pretty sure the mercurial and untrustworthy bit [was] accurate in both contexts,"

The 10 cables we wish we'd found (but never did), The Grauniad, After Wikileaks, Saturday, 5 Feb 2011, p.7

http://www.guardian.co.uk/theguardian/2011/feb/05/after-wikileaks?intcmp=239