Britain's best-paid banker will be forced to justify his lavish income in a bruising encounter with MPs today.
Bob Diamond, the Barclays chief executive, will be challenged to waive an annual bonus that could amount to between £6m and £10m.
Members of the Commons Treasury Select Committee will also call for Barclays to lift the veil of secrecy over the extent of bonus payments to all top staff. Some suspect that "supplementary salaries" are being paid by major banks as an alternative to bonuses.
The scene is set for bitter exchanges with Mr Diamond who is likely to resist pressure to forgo his bonus. He has waived it for the last two years, but is understood to have decided to accept it for 2010. The fact that he could have otherwise expected a handout of about £20m because of his background in investment banking – and that it will be paid mainly in shares – will not assuage MPs' anger. Mr Diamond is known for his blunt style, dismissing criticism of "casino banking" as generally coming from "people that don't understand what a bank does".
John Mann, the Labour MP who is likely to lead the attack, said: "I will want to know whether he will give up his bonus or will ignore the Prime Minister and take it. I also want to know whether there are supplementary salaries that are not reported as remuneration, but effectively are bonuses."
Committee members said feelings were running high. The number of redundancy notices issued by councils in the wake of the Government's spending cuts has topped 100,000, the GMB union said last night.
Chuka Umunna, the Labour MP for Streatham, said: "People are extremely angry with the banking sector and want to know what their contribution is to reducing the deficit." Andrew
Tyrie, the committee's Conservative chairman, has condemned the "defective corporate governance" that led to "excessive bonuses".
Mr Diamond, who has earned an estimated £75m over the last five years, will be accompanied by Antony Jenkins, chief executive of Barclays' Global Retail Banking arm. The Government's dilemma is that while it can directly control the bonuses paid out by Royal Bank of Scotland and Lloyds Banking Group which are controlled by the tax-payer, it does not have the same powers over HSBC and Barclays.
* Five questions that MPs could ask Bob Diamond (but won't)
* What makes you worth 125 times more than a hospital consultant?
* What would you say to the 2,000 people being made redundant from Barclays as a result of the financial crisis? How many jobs could be saved if you reduced your estimated bonus pool of £2.5bn?
* Why do so many viable small businesses say they still can't get financing from banks? Do you think they're too big an investment risk – and isn't that a bit rich coming from a bank which went cap-in-hand to the Qataris?
* Would you agree with the allegation that the big banks are effectively blackmailing governments by threatening to leave if they don't like the tax regime? With Barclays' indirect help from taxpayers, is it time to rule out quitting the UK?
* Is Barclays still too big to fail?Reuse content