Banks distributed a total of £16.4 billion in bonuses during the first quarter of this year, marking the highest amount since the financial crisis of 2008, according to analysis findings.
The significant sum awarded from January to March, a period known for substantial annual rewards to top earners, follows a year of substantial profits for major banks in the UK. The Trade Union Congress (TUC) has called upon the government to increase a bank windfall tax, emphasizing the necessity and timeliness of such a move.
Economists attribute much of the public’s discontent and frustration to the sluggish growth in living standards post the 2008 banking crisis. The government’s injection of billions into bank bailouts resulted in a spike in public debt, leading to austerity measures like spending cuts and tax hikes.
Analysis by the TUC, based on Office for National Statistics data, indicates that around 1.1 million workers in the finance and insurance industry received bonuses totaling £25 billion in the year up to March, with the largest portion amounting to £16.4 billion between January and March.
Data also reveals substantial bonus payments received by top executives of major British banks. Lloyds Banking Group’s chief executive, Charlie Nunn, received £7.4 million in total for the previous year, including £4 million in bonuses. Similarly, NatWest’s boss, Paul Thwaite, received £4 million in bonuses as part of a £6.5 million remuneration package for 2025.
While these figures encompass all employee levels, they are skewed by traders and other high-earning individuals who command substantial payouts. Ahead of Chancellor Rachel Reeves’ upcoming Mansion House speech, the TUC advocates for an increase in the bank surcharge tax to reduce energy bills for households through a social tariff.
The TUC proposes that a 16% surcharge could generate £24 billion over four years, with a 35% surcharge potentially raising £60 billion in the same period. Even restoring the surcharge to 8%, the TUC’s suggested minimum level, could yield £9 billion over four years, according to their analysis.
These developments come on the heels of the big four banks in Britain – Barclays, HSBC, Lloyds, and Natwest – collectively reporting profits of £45.7 billion in 2025. TUC General Secretary Paul Nowak voiced concerns over the rising costs for consumers alongside burgeoning bank bonuses.
Emphasizing the need for a bank surcharge tax hike, Nowak highlighted the surging profits of major banks amidst economic challenges faced by the public. The TUC urges the government to utilize the increased tax revenue to alleviate the financial burden on households.
Sara Hall, co-executive director at Positive Money, criticized the disparity between record bank bonuses and the ongoing cost of living crisis faced by many. Hall called on political figures like Andy Burnham to capitalize on the opportunity to address this issue and restore public trust.
By prioritizing policies that benefit the public, Hall suggests that redirecting bank profits towards supporting struggling households and businesses is essential. She underscores the importance of government intervention in ensuring fair distribution of wealth and addressing pressing economic challenges.