Brown Signals U.K. Won’t Block Bonus Payments at RBS (Update1)

[Joanne98]

Feb. 5 (Bloomberg) -- Gordon Brown signaled he won’t block bonuses to traders and junior executives at Royal Bank of Scotland Group Plc as lawmakers stepped up pressure on the U.K. prime minister to adopt a U.S.-style plan capping pay.

While Brown told reporters today he supported President Barack Obama “strongly” on the need to change the way bankers are rewarded, he twice refused to say there would be a ban on bonuses at RBS, in which the government has a majority stake.

“We agree with President Obama that a new approach is required,” Tom Hoskin, a spokesman for Brown, told journalists in London today. “On the specifics, the U.S. administration have set out their position, and we have set out ours.”

Lawmakers from all three of Britain’s main political parties are calling on banks and the government to restrict bonuses as the costs of taxpayer-financed bailouts spiral into the hundreds of billions of pounds.

“If they have given carte blanche to bonuses, that will fuel public anger,” John McFall, a member of Brown’s Labour Party who leads a panel overseeing Treasury policy, said on BBC radio. “If there are big bonuses, there’ll be a huge outcry.”

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