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Unions demand overhaul of banking sector bonus policies

Unions have reacted to what they call "obscene bonuses" in the banking sector by calling for an overhaul of reward strategies.

On Friday JP Morgan Chase reported it had paid out $26.9 billion (£16.81 billion) in bonuses and employee benefits to staff over the last year.

TUC general secretary Brendan Barber said: "These obscene bonuses paid so soon after the world's taxpayers had to rescue the banking system show that there is something fundamentally wrong in the relationship between banking and the rest of the economy.

"Banks are meant to support society, but instead taxpayers' support guarantees that, whatever happens to the economy, banks will continue to pay gigantic bonuses.

"The best way to reintegrate banks into society is to make sure they pay a proper contribution through a transaction tax - a solution rapidly gaining support both here and abroad."

But the TUC announcement comes as The Telegraph reported Goldman Sachs, which has reported a $20 billion bonus pot, is encouraging staff to donate a proportion of their remuneration package to a charity in the hope of reducing animosity against it.