Bankers' bonus tax failed, admits Darling

Former Chancellor says 50 per cent tax on bankers' bonuses failed to change attitudes towards pay.

Alistair Darling has admitted that the 50 per cent tax on bankers' bonuses brought in by the last Labour government failed to change the industry's attitude to pay.

The former Chancellor, who introduced the levy last year, said he thought it was unlikely the tax would be retained by the current Con-Lib coalition government.

"I think it will be a one-off thing because, frankly, the very people you are after here are very good at getting out of these things and... will find all sorts of imaginative ways of avoiding it in the future," Mr Darling told a financial services conference sponsored by Nomura, the Japanese investment bank.

"But what I wanted to do was send a message to them that we all live in the same world together."

Darling, who is stepping down from Labour's shadow cabinet next month, said that it would be difficult for the government to take "rational decisions" as long as there is public anger over pay.

"You just need to be sensitive," he said. "Otherwise I fear that it holds the risk that someone is going to do something which, in the cold light of day, a few years down the line, maybe wasn't such a good idea."