Former City minister: Scrapping bonus cap could have waited ‘a little longer’

John Glen, the former City minister, has said the decision to scrap the bankers’ bonus cap should have waited amid a cost of living crisis.

Glen told the Following the Rules podcast that the removal of the cap, announced last week by new Chancellor Kwasi Kwarteng, “was something that I would have deferred for a little while longer.”

In his first interview since leaving the job he held for almost five years, Glen did say the cap was not an “economically efficient mechanism” and that Kwarteng would argue “it sends a signal” that Britain is open for business.

The removal of the bonus cap has been welcomed by the Corporation of the City of London and by a host of free market think tanks but has provided Kwarteng’s shadow Chancellor with ample ammunition this week.

Glen said he was looking forward to seeing the Financial Services and Markets bill pass through parliament under the new City minister, Andrew Griffith, which is expected to lay out a post-EU framework for the City on a raft of issues.

“It was really the combination of a lot of work over the last 18 months,” he said.

“I was always intending it to be a positive contribution to opening up financial services for the future, doing it in a way that wasn’t diverging (from EU rules) for the sake of it but listening to the City of London… about what order markets need, but also what sound regulation is needed.”

Glen did also warn that the passage of the bill would continue to require work from officials to ensure it works for both regulators and for the City.

“Financial regulation is complicated. It’s not something that mainstream politicians can fully understand, because it’s dealing with quite complex regulations that need a lot of serious scrutiny from experts.”

John Glenn discussed the bankers’ bonus cap, the future of the FCA and a host of other issues on The Following the Rules podcast, presented by Lucy McNulty