Cable warns of 'train crash' over bank bonuses

Business secretary Vince Cable has warned that bankers would be heading for a ‘train crash’ if they award themselves large bonuses as spending cuts take their toll.

Cable told a fringe meeting at the Liberal Democrat conference there would be an ‘enormous kick-back’ from coalition MPs if there were large pay-outs.

‘There’s a potential train crash ahead if there’s a very generous bonus round,’ he said. ‘I’m not just talking about the Lib Dems. Some of the Conservatives are on the warpath too,' he said.

He added that tax measures remained an option for the government to combat large bonuses and encourage the banks to boost lending.

‘It remains an option, particularly if the banks decide to spray out lots of money on bonuses and dividends at a time when small businesses are being starved, then the case for taking action is a compelling one,’ he said.