Executives at Northern Rock, the nationalised lender, could have their bonuses axed by the Chancellor.

The bank’s board has proposed executive bonuses of up to 30 per cent of annual salary on top of already-generous pay packages for a number of senior managers including Ron Sandler, the chairman, who is paid £90,000 a month.

But Alistair Darling yesterday sounded out a warning that executives should not expect a top-up. “[Bonuses] would definitely have to come through me,” said Mr Darling.

Treasury sources said that the Government will be unlikely to sanction bonuses at Northern Rock while insisting that other high street banks it bailed out cut their own executive remuneration.

A Treasury spokesman said: “No approval has yet been given on the long-term incentive scheme for senior management. In line with our agreed Shareholder Relationship Framework document, this must be tied to the delivery of Northern Rock’s business plan, currently under review.”

Northern Rock has yet to present the executive remuneration scheme for approval. Only one member of the board, Gary Hoffman, the chief executive, is absolutely entitled to a bonus, although the level of his payout will be determined by Northern Rock’s remuneration committee.

Northern Rock refused to comment on whether remaining senior employees who were working at the bank in the years it developed its risky borrowing model will be entitled to a bonus this year.

The proposals for a bonus of 30 per cent were revealed by Unite in its submission to the Treasury Select Committee earlier this year and Northern Rock has consistently refused to comment on the figure.

A spokesperson for the bank said: “The only thing we’ve confirmed is that we have introduced a basic remuneration scheme for all our staff based on the delivery of milestones within our business plan, the milestones being the repayment of the government loan.”

The bank has agreed to pay almost all its staff a 10 per cent bonus for 2008.

But executive bonuses could jar with plans by the bank to axe 2,000 jobs. Northern Rock has already let 1,300 employees go and the redundancies were a particular blow for job prospects in its north east England heartland.

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