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Marks Satin Comment on City Bonuses

Marks Satin Comment on City Bonuses
 
Dave Way, managing director of financial services recruiter Marks Sattin, said: Big financial institutions dont run bonanzas to give away free money at bonus times.  They are businesses seeking to maximise profit.  The bonus which is just another form of performance-related pay is designed to maximise that profit. Although taxpaying observers may find bonus season galling, its in the UKs interest for this to happen.  Big bonuses mean more cash for the treasury in income tax receipts.  Big bonuses reflect big profits, which mean job creation and high corporation tax revenues as well.  Of course, a responsible approach has to be taken to remuneration for short-term, high-risk gains, but giving financial professionals an incentive to generate money has positive consequences for everyone.
 We shouldnt forget that before 2010, remuneration for many financial professionals had been frozen for a number of years.  That was all well and good in the downturn but last year, as the business environment started to improve, we saw a massive surge in the volume of counter-offers given to resigning workers.  Companies have to fight for the best talent again.  Any company unwilling to offer competitive packages will be stripped of its talent base and will lose out in the long run.  This is as true of the UK as it is of individual businesses.  We must remember that however distasteful bonuses seem, they are a necessary part of the business-model for UK inc.

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