Barclays will announce bonuses of more than £600 million today, pushing the total to be paid out by banks supported by the taxpayer to more than £2 billion. The bank does not need official approval for the payments as it did not take part in October’s £37 billion bailout. But Barclays has taken advantage of tens of billions worth of other state support and is keen to use a new Treasury-backed insurance scheme for toxic assets.

Its investment banking arm Barclays Capital is expected to pay out £600 million and there will also be bonuses for people in the retail and commercial arm.

The bonuses, about half last year’s total, are due to be approved by Sir Richard Broadbent, the former executive chairman of HM Customs & Excise, who is the senior independent director at Barclays and chairs the board’s remuneration committee. A former Schroders executive, Sir Richard has received £630,000 in fees from Barclays over the past four years.

The payments will fuel the row sparked by reports last week that Royal Bank of Scotland - 70 per cent owned by taxpayers - was seeking approval for large bonus payments.

RBS, which has taken £20 billion in rescue capital from the Government and is still regarded as being in intensive care, wants to pay out just short of £1 billion to tens of thousands of its staff including senior bankers.

It is contractually obliged to pay about £500 million to former employees of the Dutch bank ABN Amro, part of which it bought in 2007. The rest is to bankers in successful parts of the bank, including foreign exchange dealers, some commodities traders and the profitable insurance arm.

RBS has set a cap of £25,000 on the cash element of any bonus, with the bulk of large bonuses being paid in RBS shares. Lloyds, which has just absorbed HBOS and taken £17 billion of rescue money from the Government, is estimated to be planning hundreds of millions of pounds of bonuses, though the total may be more modest because of its much smaller investment banking operations. Main board directors of RBS and Barclays have waived any bonuses for 2008, while Lloyds directors will receive only share-based bonuses.

The plan to pay out bonuses in new shares has concerned some existing shareholders because their own ravaged holdings will be further diluted. Some argue that if this is the low point for the banks, their shares will bounce dramatically, giving huge windfalls to those receiving bonuses in shares.

Alistair Darling said yesterday that he had spoken to Stephen Hester, the new chief executive of RBS, adding: “Absolutely no figure has been agreed. They have to understand that these banks would not be here but for the British taxpayers, therefore they have to show the degree of restraint that people would expect.”

The Chancellor also announced a new, year-long review by Sir David Walker, a former Morgan Stanley chairman, into the way banks are run.

George Osborne, the Shadow Chancellor, dismissed Mr Darling’s response as totally inadequate. “The problem of bonuses in the Government-owned banks has been looming for months, but now they have set up another review that will be far too late to do anything about this year’s bonuses. They should stop dithering.”

Tomorrow, Sir Fred Goodwin, the former RBS chief, will be among former bank executives questioned by the Treasury Select Committee.

QUESTIONS, QUESTIONS FOR SIR FRED

Times Online readers ask questions that they think Sir Fred Goodwin, the former chief executive of RBS, should answer:

Now that it is 70 per cent Treasury-owned, might it not be appropriate to change the bank's name? How about National Westminster Bank?

Posted by: Maurice | 5 Feb 2009 20:24:43

Do you agree with Gordon Brown that the downfall of RBS is entirely due to problems in America, or, unlike Gordon Brown, do you accept that you made mistakes? If the latter, what were those mistakes?

Posted by: Searcher | 6 Feb 2009 08:55:49

My son works in an RBS call centre. What should he say to disgruntled RBS shareholders and savers who phone to complain? The vast majority of bank workers are honest hard-working people on average pay but have been tarred with the same brush as you and your ilk. The very least you can all do is pay back your bonuses.

Posted by: Gwen | 5 Feb 2009 23:03:05

Why did you buy NatWest at the expense of the relationship between RBS and Sir George Mathewson? Do you regret not taking advice / listening to your elders?

Posted by: George Myerscough | 6 Feb 2009 22:17:02

Why did you waste so much funds on Formula 1?

Posted by: David Thomspon | 7 Feb 2009 07:37:47

Can I come stay on your yacht?

Posted by: Mark | 6 Feb 2009 01:25:27

Who do you bank with?

Posted by: Lee Jakeman | 6 Feb 2009 07:05:16