Scrapping the bonus cap has only widened the City’s gender inequality

It is seven years since Theresa May told major employers to start publishing data on the pay gap between the men and women on their payrolls. 

Along with the energy price cap it is one of the few enduring legacies of her turbulent three years as prime minister.

 Although far from a perfect measure, the data has provided a useful snapshot. What stands out from the figures provided by today’s deadline is that while the gap in base salaries is closing in many sectors — tech in particular seems to have made good progress — the City still has a long way to go. 

The biggest and apparently widening disparity is not so much in pay as in the performance related bonuses that make up such a large part of the remuneration for the high flyers in the Square Mile. 

What might be behind this unwelcome trend? 

Some point to the lifting of the cap on bonuses in October. That meant that this year’s bonus round in the City was the first for a decade when bonuses could exceed the twice base pay limit imposed by the EU back in 2014. 

Whatever the rights and wrongs of that decision, the biggest beneficiaries will be those star traders who can earn vast bonuses if they make good profits for their employers. And you only have to drink at the City pubs where many of them unwind after a hard day at the dealing screen to know that a substantial majority are men. 

That may not always be the case, but for the foreseeable future it would appear that one unintended consequence of the decision to scrap the bonus cap has been men taking home an even bigger share of the spoils at the larger City banks. That is certainly is not what Theresa May would have hoped for when she launched gender pay gap measurement back in 2017