Bonuses awarded to City high fliers have reached a record £19 billion, fuelled by the boom in mergers and acquisitions and boardroom deals, the Government has revealed.
The Office for National Statistics said bonuses rose by £2.5 billion this year following a rise of £1.5 billion last year.
An analysis of the experimental data on average weekly earnings supplied by ONS showed bonus payments jumped 16 per cent - with around £10 billion of the overall figure going to those in the financial sector.
These large bonuses - equivalent to £25,000 for every City worker - have been cited as one of the factors that pushes up house prices in London.
The data covers the period between December 2005 and April 2006 when City bonuses are traditionally given.
Harry Duff, from the ONS's employment, earnings and productivity division, has analysed the effect of bonuses on payment growth.
"Bonus payments are a major influence on pay growth," he said. "Changes in their level or the month in which they are paid can have a significant effect on growth rates."
While top flight workers in the banking sector benefit from the majority of bonus payments, with all the major
banks reporting record profits last year, the overall bonus figures include awards to boardroom executives.
Earlier this year, a report from pay specialist Independent Remuneration Solutions revealed leading executives of the UK's biggest companies now earn £3.3 million a year on average, thanks to large bonuses and performance-related incentive plans.
Actual salary accounted for 22 per cent of the average figure paid to the chief executives of FTSE 100 Index companies in 2005, while long-term incentive plans amounted to 30 per cent and bonuses made up 19 per cent. Pension plans contributed 16 per cent.