UK Chancellor of the Exchequer Kwasi Kwarteng has been reported to be considering removing the cap on bankers' bonuses as "a way of making London a more attractive place for global banks to do business" (BBC).
How is this expected to operate?
Conventional interpretations would be that it would encourage more (or different) activity by existing banks and bankers, or would attract new banks and bankers who are not interested in operating in that capacity in the UK currently.
Has Kwarteng indicated that he believes that bankers are currently not doing what they could, or that the present UK banks and bankers are unsatisfactory and should be replaced or augmented? Or has he given any indication of any other mechanism that would achieve his desired outcome and/or benefit the UK economy?
Edit : Additional references :
Johnson had ruled out the suggestion in June this year, though this article from just before I posted the question suggests Kwarteng is looking "to boost London's post-Brexit competitiveness" while Truss has indicated she believes that existing regulations "hold the City, and its contribution to the entire country, back". This article also mentions "competitiveness".
Since I posted the question the Telegraph mentions support from the Bank of England, and the Guardian has published a more comprehensive discussion (thanks Stuart), which also covers some suggestions how the plan might not work as intended - or, at least, as indicated.
All the articles contain references to what people say they want, but less information on how this would happen. In particular, I've so far been unable to find a reference to anything Kwarteng believes banks should be doing differently, or indications of any banks or bankers that have not been operating in the UK under (and more specifically because of) the current policy of bonus caps.