UK banks paid out £16.4 billion in bonuses during the first three months of 2026, the highest quarterly figure since the 2008 financial crisis, according to analysis by the Trades Union Congress (TUC). The record sum, covering January to March when many annual bonuses are awarded, follows another year of substantial profits for the country's largest lenders.
TUC Calls for Windfall Tax on Banks
The TUC has renewed its call for an increased windfall tax on the banking sector, describing it as “common sense and long overdue.” The union body argues that soaring profits and bonuses justify a higher tax burden to support struggling households. The analysis of Office for National Statistics data suggests that £25 billion was paid in bonuses to approximately 1.1 million workers in the finance and insurance industry in the year to March 2026, with the largest share—£16.4 billion—paid in the first quarter.
TUC General Secretary Paul Nowak said: “While sky-high bills are looming for working people, bank bonuses are booming. Every time there is talk of taxing banks, some of the richest people in the country start whining and try to claim they can’t afford to pay any more. But the big banks are making a killing off the back of higher interest rates and mortgage misery across the country. They can well afford to pay more tax. The case for an increase in the bank surcharge tax has never been greater. It’s a long overdue common-sense solution – and the government should use the money raised to cut people’s energy bills.”
Profit and Bonus Figures
Separate data reveals the scale of bonuses awarded to top executives. Charlie Nunn, chief executive of Lloyds Banking Group, received a total package of £7.4 million for 2025, including £4 million in bonuses. Paul Thwaite, boss of NatWest, also received £4 million in bonuses as part of a £6.5 million package for 2025. While the figures include all levels of workers, the numbers are skewed by high-earning traders and other professionals who can command large payouts.
Britain's four largest banks—Barclays, HSBC, Lloyds, and NatWest—generated combined profits of £45.7 billion in 2025. The TUC's analysis comes ahead of Chancellor Rachel Reeves' Mansion House speech, where the union is urging an increase in the bank surcharge tax to permanently reduce energy bills for most households through a social tariff.
Proposed Tax Rates and Revenue Estimates
The TUC proposes that a 16% surcharge would raise £24 billion over four years, while a 35% surcharge—matching the windfall tax imposed on energy companies by the previous Conservative government—would bring in £60 billion over four years. Even restoring the surcharge to 8%, which the TUC describes as the “bare minimum,” would raise £9 billion over four years, the analysis claims.
Sara Hall, co-executive director at the group Positive Money, said: “Record bonuses to celebrate record profits - the cost of living crisis must be something of a fantasy to City bankers. Banks aren’t redirecting the windfall profits they’ve made from higher interest rates towards the households or businesses struggling to pay them, so it falls to the Government to do so in their stead. Andy Burnham is being handed a rare opportunity to rebalance the scales in the public’s favour - he should seize the chance to implement this popular policy that won’t cost the Government a penny, but might just earn it some desperately-needed trust.”
Background: Living Standards and Public Debt
Economists note that much of the public anger stems from slow growth in living standards since the 2008 banking crisis. The government was forced to inject tens of billions into bailing out banks, leading to a surge in public sector debt and triggering spending cuts and tax increases. While most big banks have recovered, ordinary families continue to feel the impact.
