The following transcript is from the Andrew Marr Show on Sunday the 13th of December with his interview with Boris Johnson. It echos the concerns in our previous blog regarding the big bankers moving out of the City.

ANDREW MARR: Okay. Another of your big responsibilities obviously is the City of London as a financial hub. So how seriously do you think we should take all the stuff – there’s a lot of it in the papers again today – about people going abroad, going to the British Virgin Islands, Switzerland, etcetera, to avoid the 50% impost?

BORIS JOHNSON: Obviously there’s going to be a lot of fluttering in the dovecotes, a lot of plaster coming off the ceiling after what we saw last week. I think you know people should realise what’s really happening here. This was basically a measure intended to throw a lot of sand in people’s eyes and to disguise I mean the bonus tax.

ANDREW MARR: (over) You don’t think it’s going to raise real amounts of money?

BORIS JOHNSON: Let me … I don’t think it will. I think its primary intention was to occlude, to cover up what was happening with the national insurance contributions – the huge hit that the rest of Britain is taking – and to say look what we’re doing to these fat cats and they’ve had it coming and here it is, this is what we’re doing. It won’t raise anything like the sums that are proposed by the Treasury – not least because I’m afraid the bankers will find ways of getting round it by deferring their bonuses, paying them in other ways.

ANDREW MARR: So can I … What should Conservatives do about this because bankers are very unpopular at the moment, for very obvious reasons, and some of them are taking enormous bonuses. What can or should be done about it?

BORIS JOHNSON: Well you know I said a few months ago that I thought that there was a real problem building up. You remember round about end of summer, September we started to see headlines saying it’s going to be a bumper Christmas, folks – bonus… you know they were going to get billions of pounds in bonuses again. And I thought that was going to be extremely damaging, so you know I made it clear my own view was that the bankers should make a collective effort to show restraint, not to pay themselves …

ANDREW MARR: (over) Yuh … which, which they don’t.

BORIS JOHNSON: And I’m afraid that they didn’t, and I think it became a political inevitability that some kind of retribution was going to be exacted. All I can say, all I can say is …

ANDREW MARR: (over) So how you can exact some kind of retribution without pushing people abroad? That’s the question.

BORIS JOHNSON: My own view would have been it would have been far better for them to have come to the table and said, right, we understand.

ANDREW MARR: (over) Yuh, but given that they haven’t?

BORIS JOHNSON: (over) We understand that we should have made a much greater contribution, we understand that we have taken huge sums of taxpayers’ money to keep our institutions afloat and there’s no doubt about it.

ANDREW MARR: Sure, but we’re left with a position where they haven’t done that. My question is, given that, what could be done, what should be done?

BORIS JOHNSON: Well I think that you know they should have shown much greater self-restraint. What kind of impost, what kind of tax you come up with, I don’t know. What I do know is that I think the failure with this particular solution is that it is not global. And although there is a suggestion of support from France – we’ve yet to see much concrete about that – there’s no real support in America. So the problem, the problem is …

ANDREW MARR: (over) So Britain should dump these measures, this particular 50% tax on everything over £25,000?

BORIS JOHNSON: I can’t prete… You know I can’t pretend I find it easy to think that the bankers should have got away scot-free this Christmas with paying billions of pounds of effectively taxpayer funded bonuses.

ANDREW MARR: But in a few months time, George Osborne is going to be …

BORIS JOHNSON: (over) But I have to say, but I have to tell you I don’t think that it is a brilliantly devised measure. I think if you could have come up with a solution that brought together New York, Paris, Frankfurt – all the financial centres – and said this is how we’re going to approach it, then that might have been, that might have been better. ANDREW MARR: (over) But if George Os…

BORIS JOHNSON: (over) Speaking as the Mayor, speaking as the Mayor, that is what I would far have preferred.

ANDREW MARR: And if George Osborne becomes Chancellor in a few months time, you would say to him actually drop this?

BORIS JOHNSON: I would say to him that – and I think this is you know what I’ve been saying for quite a long time now – I would say you know it’s very, very hard to devise a bonus tax (or whatever you want to call it) that is really effective, but if you’re going to do it, then get international agreement. Because no matter how despised these people may be – and I understand people’s feelings and you know I personally think it’s outrageous that they should be paying effectively taxpayer funded bonuses – but unless you can come up with a system that penalises all great financial centres, then you’re going to end up super penalising London. And that, I’m afraid to say as Mayor, I don’t think is a good idea …

ANDREW MARR: Right, okay, okay.

BORIS JOHNSON: … because we, this city depends on financial services and the whole of the UK economy depends on the strength of the London economy.

ANDREW MARR: Sure. We seem to be going into a period in politics marked by a bit of class war. Do you think there are enough old Etonians at the top of the Conservative Party at the moment?

BORIS JOHNSON: This is a brilliantly contrived question. I don’t think … I think the classic answer to this … I can’t remember which school you went to, Andrew.

ANDREW MARR: Loretto.

BORIS JOHNSON: Jolly good school. You know I think enough of this nonsense. I don’t think the public really give a hoot, monkey’s, whatever, tinker’s cuss about where you …

ANDREW MARR: (over) So when you see Annunziata Rees-Mogg being told that she should be known as Nancy Mogg, your eyes roll?

BORIS JOHNSON: (over) … where you come from and all that kind of thing. I think they want to know what’s going on between your ears and you know what you’ve got to say to them.

ANDREW MARR: And do you think the Conservative Party is in a position now where it is appealing to the centre ground enough to win this election because you know we read at least some of the polls seem to be narrowing at the moment?

BORIS JOHNSON: I think that … You know I’m not going to say that the election’s a done deal, but I think that the Labour government is almost completely discredited. In my view, I think they’ve bogged it up in the most imperial, intergalactic fashion. They’ve run up absolutely colossal sums in debt. They show no credible way of getting us out of this mess. They seem to have absolutely no sense of how to cut waste. I think the PBR was a completely wasted opportunity. They deserve to be ejected into orbit. I think what you’re going to see … I think the story of politics at the moment is basically we know the denouement … It’s like a novel where the denouement has become obvious a little bit too early and so …

ANDREW MARR: (over) Well tell me about one of the future chapters. Next parliament, are you going to rejoin the House of Commons?

BORIS JOHNSON: I think it highly unlikely. You mean, what, in 2010? ANDREW MARR: After 2010, in the next five years. Between 2010 and 2015, does Boris Johnson return to the House of Commons? Question. BORIS JOHNSON: Well how does that work?

ANDREW MARR: Well I don’t know – you get a seat and get in, I suppose.

BORIS JOHNSON: Well you know it’s … Ask my brother to stand aside.

ANDREW MARR: Alright, there we go.

BORIS JOHNSON: (laughs) Highly unlikely.

ANDREW MARR: Boris Johnson, almost briefly reduced to silence.

BORIS JOHNSON: Nonsense, nonsense, nonsense.

ANDREW MARR: Thank you very much indeed.

INTERVIEW ENDS

Make sure you are careful with your credit card and bank details this holiday season! I personally have heard a handful of stories of petty theft this holidays season, bags getting stolen from cars parked in private driveways, break ins on homes where the thief seemed to know exactly where to look for the safe or valuable goods. With unemployment up, there are more “opportunists” out there than ever before.

Credit card fraud is also rampant more now than ever. A petrol station just down the street from us had it’s chip and pin machine hacked into by some a South Asian gang who were stealing money from customers. According to a study by life assistance company CPP, credit card fraud will peak by 18 December and hit over £200 million this holiday season. It’s very important during the last minute shopping this year when you might be stressed and a little more careless, to keep your pin number covered, check receipts against bank statements and shred any documents which might have your personal details on them.

Staff in a British Airways call centre in Germany have just been caught in a huge credit card scam. Anyone who booked a flight through a BA call centre in the last 12 months is at risk. The staff reportedly stole millions of Euros from BA customers soon after they booked their flights over the phone. Many of the staff had lists of customers credit card, bank account numbers and security codes at their desks.

BA is a reputable company of course and I personally wouldn’t think twice about booking a flight with them over the phone, this is why it is important to always check your receipts against your statements.

The Financial Services Authority has now said that the Big Banks cannot give out any big bonuses nor can they even discuss them with their employees without prior consent. Alistair Darling as threatened a heavy tax on the bonuses and the entire board of RBS say they will quit. But the FSA are sticking to their guns and refuse to tolerate any deviation from their new code on remuneration. This new code states that bonus pay must be over a longer period and a larger proportion need to be paid in shares. The CEO of the FSA, Hector Sans, has said that banks cannot use money for their bonus pool when it is more appropriate to use the money to bolster capital cushions.

While big banks have gotten into serious trouble and some have even been bailed out by the taxpayer, surely not all of them have the same amount of exposure to toxic debt and risky investments and should not be punished for keeping their nose relatively clean. Some middle ground should be found here. Sales people are driven by commission and bonuses and without them the City would not thrive. What would the FSA have to say if their banks turn their backs on London and move to the likes Singapore or other emerging markets? Surely the new 50p in the pound tax rate was enough to scare off the high earners but perhaps this will be the final nail in the coffin and the turning off of the lightbulb in London. Thoughts?

It seems the major news story concerning the markets today is all about RBS and whether or not Alistair Darling and the British government will allow RBS to give the the big bonuses all of its competitors will be handing out. As a condition of it’s latest taxpayer bailout, RBS agreed to give the government veto rights again any new bonus schemes. My immediate thoughts were that of course a bank that was only recently saved by tax payers’ hard earned money should not be able to spend that money in a way that had contributed to the state the market is in at the moment. But after further thought and hearing different points of view, it doesn’t seem that simple.

Today’s Times reported that a thousand investment bankers have left RBS already. This only represents 5% of the staff in RBS’ investment division, but the government’s threat to cut the bonuses and another suggestion of a windfall tax will most likely mean more resignations in the new year. If RBS loses it’s major investment bankers, how can it compete with the rival banks who are taking them? RBS also argues that the profits made by the investment division is vital to getting the money back for the taxpayers. Peter Montagnon, the Director of Investment Affairs at RBS also argued this point and believes the mass exodus of talented investment bankers will seriously cripple the bank. Although the board has said it thinks they will be able to pay more than last year’s £1 billion in bonuses, he still remains unhappy. It seems that even though times are tough, pay in the City is soaring due to lack of competition and companies trying to poach staff from each other.

If Gordon Brown and Alistair Darling agree to pay, no doubt every voter outside the City will turn against them in anger. But if they veto these bonuses surely they are helping to nail the coffin of the bank the taxpayers bailed out so recently.

Alistair Darling on BBC One’s Andrew Marr show this morning

Bank Bonuses Back to Bite Alistair Darling