With his proposal to cut bonuses for European bankers, Belgian politician Philippe Lamberts has become public enemy No. 1 for Britain's financial industry. Nothing could make him happier.
LONDON – A Belgian Member of the European Parliament with a degree in computer engineering, Philippe Lamberts doesn’t look like a man who would terrorize The City. With his sensible haircut and good manners, this father of four is not your run-of-the mill revolutionary intent on bringing the British financial financial center to its knees.
But don’t let appearances fool you. Lamberts, a Green party member first elected in 2009, is the man who infuriated London’s bankers by spearheading the campaign to limit bonuses in Europe. On Feb. 27, the European Parliament and the European Council both agreed to vote on his proposal – starting 2014, EU-wide bonuses will not be able to exceed the total amount of their salary. Shareholders, though, will have the possibility of increasing bonuses to up to twice the amount of the salary.
The Mayor of London Boris Johnson called the bonus cap a “vengeful and self-defeating attempt to pick on London,” and said he was “not going to let it happen.”
Mark Boleat, policy chairman of the City of London Corporation, said it was a “bad business decision,” that would lead to higher fixed salaries. Others –anonymously – threatened to leave for New York or Singapore.
On March 15, Lamberts chose to visit London for his 50th birthday. Upon arrival, he was immediately assailed by media – everyone from the BBC to Sky News and the Financial Times wanted to see the man who brought the bankers to their knees. The chairman of the British Financial Services Authority, Lord Adair Turner and HSBC group chairman, Douglas Flint, both met with Lamberts.
Lamberts is basking in the moment, and not feeling one ounce of regret for what he set in motion. The bankers “are squealing like pigs whose throats are being slit, so I’m guessing the bonus capping will have an impact,” he says, looking quite proud.
“Trail of scandals”
From the beginning, he knew it would be an uphill battle – some of his colleagues were accusing him of populism. “What helped us was that the finance sector had a trail of scandals in its wake,” he says. The European Parliament voted in favor of capping bonuses in May 2012.
The British still believe they can turn things around at the European Council, where they can count on Economy Ministers being more sensible. But that is discounting the fact that these days, no politician in his or her right mind wants to be caught defending banker bonuses publicly. In February, British chancellor George Osborne found himself isolated and incapable of blocking the bill.
Lamberts is not against bankers per se. “I am not the enemy of the City, which is useful to the European economy, as long as it is actually serving the economy,” he says. The son of a small business owner, he’s not allergic to the private sector – far from it, he used to work for IBM. But he accuses banks of being “income-extracting” machines who play on the fact that they are “too big to fail.”
His harsh words are not just for London bankers, he has some choice words for the French financial sector as well: “The clique from Bercy (the French Financial Ministry) make me puke.” He is also very critical of the French banks that are trying to block the separation between retail banking and investment banking that is being discussed in Brussels. His dealings with the financial sector are far from over – his win over bonuses has given him a taste… for blood.