Why are bonuses still necessary?

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Contrary to expectation, it seems a comfortable majority of people are still receiving bonuses this year.

We ran a poll enquiring about bonuses a couple of weeks ago (ie. before European banks announced, but when most US banks had already revealed their numbers); 75% of respondents said they'd received some form of payout.

An even larger majority of bonus recipients felt their bonus was deserved and reflective of their hard work.

Since then, the furore over the award of bonuses at institutions which have received money from the state has intensified. There are accusations of 'raw capitalism' and calls to 'bring back the guillotine'.

Paying bonuses is starting to look very much like showing a cauldron to an Inquisitor or waving a red rag at a bull. The US website The Daily Beast says banks have badly screwed up their PR and would have been better off publicly freezing all salaries and bonuses (or maybe paying nothing at all) until things died down.

Given the public backlash, has it been a mistake to pay bonuses at all this year? Bob Diamond apparently thinks not - he tells The Guardian today that BarCap has "performed well in a difficult environment."

But are bonuses really still necessary now that the 'war for talent' has been relegated to the distant past?

And why do employees at loss making banks, or banks in receipt of taxpayers' money, merit performance related pay at all?

Let us know below.

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