Gavin Hayes, general secretary, Compass

There is a compelling case to cap bankers' bonuses, in order to curb the excessive and dangerous risk culture that continues to pervade the City of London, and if we are to avoid another financial catastrophe down the line.

Excessive bonuses fuelled excessive risk-taking, which played a significant role in causing the great recession—that is the firm view of the Treasury Select Committee and the British public: a recent YouGov poll commissioned by Compass found 83 per cent agree with this.

This is not only a systemic danger to the banking system, it is a danger to our entire economy. If we are to have a sustainable, secure and stable economy, then there can be no turning back to a boom and bust economy that valued reckless speculation over hard work and responsibility. It is of fundamental importance that we address this issue and instigate major reforms including caps on the amount a bank pays in bonuses.

As well as a cap on the total amount banks can pay in bonuses linked to profit, bonuses should be linked to individual performance and kept at a reasonable ratio in relation to basic pay; for high value bonuses, there should be a claw-back mechanism so that bankers do not receive money if their deals go wrong. Guaranteed bonuses should be avoided altogether.

It was American economist Paul Krugman who said of the recent Goldman Sachs bonuses: "It's good news for financial superstars in general... but it's bad news for almost everyone else."

We need sensible measures to ensure a stable economic environment for all businesses whether they be banks, global corporations or corner shops.

Angela Knight, chief executive, British Bankers' Association

I understand the emotional pull of saying high-rolling pay deals should be capped. That's as true for banking as it is for footballers, catwalk models or chat-show hosts. And the reason's the same—very few people have the specific skills to earn them mega-deals in whatever field they work, and even fewer actually get those kind of packages.

Financial services in the UK employs around 1.5 million people—with about half-a-million in banking alone. The kind of deals that make the headlines are paid to a very small percentage of people with the vast majority of staff on far more modest pay. In fact, only recently the sector was, perversely, criticised by the Equalities and Human Rights Commission for not paying enough to its female workers.

But the issue is the few who take home the big bucks. Banks in the UK are already working with the Financial Services Authority on a code of conduct around pay. We have always accepted that remuneration and bonuses need to be tied to the long-term success of the business and not for rewarding foolhardy risk-taking or flash in the pan results.

But that doesn't mean a ceiling on bonuses. The UK industry needs the flexibility to attract, reward and retain the best talent there is. Make no bones about it—banking is a global business and the brightest can, and will move to where the best deals are found.

It is a pity that bankers' remuneration has become such a political dog-whistle issue because, if the UK is serious about remaining at the forefront of the world's financial services industry, we need to work together to ensure pay deals reflect the need to reward success and do not create holes through which talent can drain away to our competitors.