Lord Mayor denied knighthood after backing bankers' bonuses

By Philip Aldrick, Banking Editor


Published: 7:04PM GMT 27 Dec 2009

Luder, the 681st Lord Mayor who stepped down last month, will become the first
top City Alderman to be denied the honour since Harold Howard in 1954. For
the past century, with very rare exceptions, every Lord Mayor not already
knighted has received the honour.

Mr Luder, a former Labour councillor, is thought to have angered officials
with his
defence of bankers' bonuses.

In light of the public outcry, the Cabinet Office has decided to give him a
lesser honour as it does not want to provoke a backlash by rewarding City
champions.

Banks have received hundreds of billions of pounds of taxpayer support this
year and made untold profits through so-called "hidden gifts" –
the easy money pocketed from exploiting low interest rates and other central
bank measures to reflate the economy.

To the City's dismay, banks intend to pay as much as £6bn in bonuses this year
– prompting the Treasury to launch its much-criticised 50pc "super
tax" on bonus payments above £25,000.

The Cabinet Office would not comment on whether Mr Luder will be knighted in
the New Year Honours list but stressed that "neither the Prime Minister
nor his office has interfered with the list recommended by the independent
nominations committee". The City of London declined to comment.

Writing in The Daily Telegraph in June, Sir Gus O'Donnell, Cabinet
Secretary and chairman of the nominations committee, said that the honours
system was changing to "ensure recognition goes only to those people
who deserve it the most".

He specifically stated that "there are no longer 'automatic' knighthoods
for ... leaders of professional bodies, chairs of large companies, Lord
Mayors of London or permanent secretaries in the Civil Service".

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