£12,500 bonus average in financial sector

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Workers in the financial sector enjoyed average bonuses of £12,500 last year as pay-outs showed little sign of falling despite efforts to curb City excesses, according to official figures today.

The financial and insurance sector paid out bonuses worth £14 billion in the year to the end of March - the same as the previous year, according to the Office for National Statistics.

The sector accounts for 40% of the bonuses paid throughout the country, despite employing just 4% of the workforce.

A slight rise in the number of people employed in the sector meant that the average bonus pocketed by employees dropped by just £100.

This compares with people working in health and social care sectors, whose bonuses were "negligible".

The Treasury earlier this year thrashed out Project Merlin agreements with the biggest banks in a bid to curb the bonus culture which helped create the financial crisis by encouraging bankers to take risks.

It agreed with HSBC, Barclays, Royal Bank of Scotland and Lloyds that their bonus pools for 2010 would be lower than the previous year.

However, the agreement only covered the four biggest banks, leaving smaller firms exempt.

Last year's figure for bonuses in the financial and insurance industries was £2 billion higher than in 2008/09 - immediately after the financial crisis struck - and was 58% higher than in 2000/01.

Bonus payments in the sector peaked immediately before the financial crisis hit, when bonus payments totalled £19 billion and were worth 45% of all pay-outs across the country.

TUC general secretary Brendan Barber said: "The Chancellor's austerity message has failed to reach the City, where a small clique of super-rich bankers have grabbed 40% of all bonuses paid out in the UK.

"City bonuses are still far too high and the incentives for risky and damaging decisions far too great, especially when bankers know that taxpayers always have to pick up the tab."

Meanwhile, across the economy as a whole, bonuses of £35 billion were paid, which was the same as the previous year.

The average worker in the private sector received a bonus of £1,670, which was nearly 10 times higher than the average public sector bonus of £180.