Britain sharply cuts RBS bonuses

LONDON, Feb. 18 (UPI) -- The British government has sharply curtailed the bonus system at the Royal Bank of Scotland, British Prime Minister Gordon Brown said.

In an article published in The Times of London, Brown wrote that the government "won't pay for one-way bets."

Although RBS -- now 70 percent controlled by the government -- planned on paying $1.42 billion in cash bonuses this year, the Treasury has reduced that sum to $248.79 million, The Times said. A year ago, the bank handed out $3.55 billion in bonus pay.

The slashing has gone as far as cutting the $2,800 bonus pay RBS tellers have come to expect. Tellers will settle for a 10 percent raise instead, The Times said.

Bonuses set in place by binding contracts will be honored. But, the system of "old excesses" is on the way out, Brown said.

General Secretary of the Trade Union Congress Brendan Barber questioned the bonus system.

"Whatever the legal niceties, the real question remains: Why do bankers need bonuses to do their jobs properly when the rest of us are happy to put in a good day's work for a straight day's pay?" Barber said to The Times.