By Tom Geoghegan BBC News Magazine

Millions of pounds paid in annual bonuses to City staff should be subject to a windfall tax to fund the NHS, say MPs. But is working in London's financial hub really as flash as it sounds?

Up to 1,000 City workers will earn an annual bonus of �1m-plus, it is estimated. To observers on the outside, such sums underline the impression of a world of inflated earnings and conspicuous consumption.

This image is hardly diminished when Labour MPs urge the Treasury to boost funding in the NHS with a one-off raid on what one of them, John McDonnell, calls "obscene profiteering" among "wide boy" bankers.

On the other hand, some financial experts insist the bonus payments are given entirely on merit and help to stimulate the economy.

So what's the truth behind the stereotype and what is it really like to work there and earn these bonuses? A current trader and a former broker lift the lid on life in the City.

Justin, who in his 30s, has worked in the City since 1997. He has been trading for the past five years, currently in derivative options. He earns a salary of �60,000.

I'm not expecting much of a bonus this time because I came back from a few years in Frankfurt and I'm in a new job putting a team together with a view to expanding what we're doing, so we're still in the early stages and not making much profit yet.

I did get a bonus of 80,000 euros once, which was 125% of my salary, which I was pretty pleased with. That's about �50,000 but the tax rate in Germany is pretty high so it was about �30,000. I invested two-thirds of it, cleared credit cards and paid off loans, bought golf clubs and things.

There's a misconception that all traders are loaded Why are City bonuses paid?

It usually comes in a one-to-one discussion with your boss so that day is particularly nerve-racking because everyone is going in to find out what they're getting and typically everyone is expecting more then they get, that's the nature of it. I used to tell people the best way to see it is as a bonus not an expectation. Some people get upset and they'll shout and moan at their bosses and demand more and sometimes it works but sometimes it doesn't.

In some jobs in the City you get a general idea of what people's salaries are but bonuses are kept close to the chest. You're more likely to discuss it with your friends outside work than with colleagues. Everyone is trying to find out what everyone else is earning for the same reasons others do it - so they can say 'I do the same job, why don't I?'

Some people get into trading because they think they're going to earn a lot of money very quickly. It's not always the case and there's a misconception that all traders are loaded. I think in some respects it's great having a job like this. There's no meetings to go to. There's a limited amount of office politics and you see your worth to the company day to day and you see how everyone else is doing.

A shopping list for the very rich In pictures

When I get to work tomorrow I get my numbers for today and your boss sees how much you're contributing. I have a bunch of screens in front of me. It's all electronic. It can be very high-pressured and I typically work from 7.30am to 5pm. When the financial markets are quite choppy and volatile, it's the best time to make money trading derivatives because they are essentially insurance for a share price.

Bad days can affect you but it's all relative. A friend of mine is a senior trader with targets 10 times mine and much bigger risk limits. The other week he lost �1m which was 20% of his P&L [profit and loss, which determines the bonus] for the year. He's made a good chunk of it back but that was a bad week. For me, a �10,000 loss would be a bad week. It's a different style of trading.

People with a bad view of the City think of the barrow boys on the LIFFE floor. Young people from Essex are the stereotype, who didn't go to university because they left school to make millions of pounds, buy a Ferrari or Porsche.

There's not too many around but you do bump into people like that if you go out. It's mostly younger people in my opinion. That's where the bad image of the City comes from. I went to university and qualified as an accountant before I did this so I went the mainstream route. If I'd joined the City at 18 and earned loads of cash, maybe I'd be the same.

I haven't yet had the big pay cheque to pay off the mortgage, go to the countryside and get a job as a postman

There is burn-out because of the intensity, it can be very stressful. It's interesting as well that the wealthiest are not traders but brokers, who are the middle men between two traders and who take commission from both. They provide liquidity in the financial markets. Some of them look older than their years because they're out two or three times a week entertaining clients.

People can be envious but generally there's a misconception about what trading is. I admire people who take jobs for moral reasons. But I think most people, if they're in a job and don't think they're getting paid enough then they would look elsewhere or ask for a pay rise and that's true for anyone in the working world.

I don't particularly like being in the Rat Race but everyone else is doing the best they can for themselves and there's a lot of greed in corporations anywhere you look. Bonuses are not just paid in the City, look at Tesco and the BBC.

It's perceived as a glamorous job but now I miss the things I used to have like job security and a pension. I earn �60,000 but it's always the potential of earning more. If I'd stayed in finance I'd be earning a bigger basic salary but the potential earnings are great for motivation.

I haven't yet had the big pay cheque to pay off the mortgage, go to the countryside and get a job as a postman. I'll give the current job 12 months and if it's not heading in that direction maybe I'll step out of trading and go back to more job security.

Stephan Bisse was a futures and derivatives broker who spent 10 years at four firms in the City, regularly picking up six-figure bonuses, before leaving for the dotcom world. He recently founded ConsensusView.com where traders can share their market forecasts.

I started in 1988, aged 22, in the commodities market and left in 1998. At this time of year, before Christmas, the traders and salesmen get called into a room one by one to be told their annual bonuses, so it's quite nail-biting before you're told your number and as soon as you learn it, people are either very happy or they make plans to go for another job. That's relative to how good you perceive the market is and how your competitors are doing.

There was a code that meant you didn't tell anyone, so the actual number was a secret. It was an implicit agreement that was strictly adhered to, to avoid jealousy and people getting upset.

Traders work under intense pressure

I was pretty much in the middle on both the salary and bonuses. It's very much a pyramid and people at the top get a multiple of people in the middle and they get two or three times the people at the bottom. The MDs get �1m plus and the middle people get about half that. I used to invest mine in shares and in my principal residence.

I started earning reasonably well in 1992/3 then in 1994 it was quite a bad year because the bond market collapsed and there was Black Monday, so I saw early on that it could go down as well as up and that taught me a valuable lesson. Very few people blew their bonus. Some did spend it on flash cars but that was a minority. Most people were quite prudent.

There were some stereotypical traders with fast cars but that changed at the beginning of the 90s and there was less conspicuous consumption, which was good in my opinion because I come from a background where it was unacceptable to show off your wealth and how much you earn. I don't think in general people discuss salaries.

You have to give your life up because it is so demanding

I went to university in South Africa and I think that by the mid 90s it was rare to see anyone without a degree on the trading floor and by the late 90s rare to see anyone without an MBA if you were building trading models or portfolios.

So it had changed since the 80s. The barrow boy image is not accurate and I think one of the positive influences of the American investment banks is that they're purely meritocratic - based on your qualifications and education - and that's a positive influence.

I was glad to leave it in the end and I don't miss it. I've two small children and happily living in Oxford. I was working very long hours, from seven to seven with a commute either end. You have to give your life up because it is so demanding, so trading and broking is regarded as a young person's job.

Your comments:

Dave Hudgell writes to complain about the role of bankers in society. Well I would point out to Dave that as successive British governments, on both sides of the political divide have realised, the City is the only truly globally competitive part of the British economy. The health system isn't globally competitive, nor is the construction industry, the mining industry, the clothing industry, the steel industry or the automotive industry. So what does the City do for you sir? It underpins the whole strength of the British economy.
Roger, London

To Giles: It's precisely because the banks get away with charging you �35 for going beyond your overdraft limit that the bosses get such big bonuses! Morally, most will agree that banking charges and management bonuses are totally ridiculous but realistically that will not change- this is a capitalist country.
Peter,

Most of the traders in the city don't even get 10% of what they make their firms in commission. Don't forget that a lot of the profit that is generated by the Investment banking industry has indirect implications on your pensions which all have direct investment in these companies and also help them invests their money. "What do these traders produce" - the trades they are executing help charities finance themselves and mortgage companies offer fixed rate products which wouldn't be as cheap to you and me without the derivatives market which underpins it. The money these companies are making isnt necessarily at the expense of someone else - in fact the financial markets make the economy as a whole richer. Anyone who know the basics of macro economics and trade understands that.
Paul, London

Yes, the city money players should pay tax on their bonuses. Many of them are exceedingly rich and it is difficult to understand why they have such large salaries just for moving money around. And with so much unemployment and low wages in the country for ordinary jobs, and the difficulty ordinary young people are having these days to be able to afford to buy accommodation, the whole aspect of the city money game is immoral.
Pee, Kent

When banks are making so much profit from their trades surely they might consider not charging 35 quid for going 10p over your overdraft. They should be better to the customers and cap the bonus. Whichever way you look at it, it is obscene that there is not more sharing of the wealth and I am not talking about employing the Eastern European Nanny to drive the Range Rover with the kids to school. Happy Chrimbo to all!
Giles

It's these City workers that dedicate their youth to study subjects such as Economics and Business that make our economy go round. If it wasn't for these people then we would be a much poorer country. So good luck with your bonuses and try not to spend it all on flashy cars that kill the environment, think about the poor people that haven't even got a blanket for the winner.
Ruth

Salaries and bonuses attract talent, which in banking means "slave of money willing to sacrifice his/hers life for the sake of making as much money as possible". Should salaries and bonus be transparent? I think the talented bankers would just leave and set up their own stuff like they've been doing with hedge funds and many advisory boutiques. It is demand and supply!
Raoul, Paris

It comes down to skills and experience and the same wage argument applies to top footballers - why do they receive the wages they do? Because there are few people on the planet who can physically do what they do. Plus, if Club A didn't pay them that much, then Club B would. Similarly in the City, there are few people who can consistently earn money for their bank, and so the bank rewards them handsomely.
Marc, London

I'm curious. What do these financial types actually produce? What do they invent? How do they further the infrastructure and progress of this country? As far as I'm concerned, all they do is buy the assets and effort of other people at a low price, and sell the same assets and effort of other people at a higher price. And invariably the money they make that fuels their bonuses usually comes at the expense of someone else actually working, producing and contributing to the country. It probably explains why outsourcing to India is so popular these days. And I can't wait for the besuited wideboys to be outsourced themselves. Maybe then they'll appreciate what British Industry over the past twenty years has gone through.
Dave Hudgell, Manningtree, Essex

I think people who complain about the bonuses that can be obtained are ill-informed. These people have to work hard long and very stressful hours with their bonuses tied directly to their success or failure. These people will also be paying 40% tax for services they are unlikely to use as the children will be in private education and all under private medical. If 400 million is given back to the state then this is only a positive. Good luck to them I say.
rob glenn, dubai

It's not just people outside the city who think the bonuses are crazy. Many of us in the supporting or more junior roles feel that the top-loading of bonuses is completely inequitable, but many sit and take all kinds of humiliation and excruciatingly dull work with a view to eventually getting to the top. City workers don't really have the imagination to challenge the management's way of doing things, because they want to BE the management! That's the difference between the City and blue collar work.
Julian , UK, London

I work in the City. If I knew I was about to be hit by a tax windfall I'd relocate to the head office in the USA, earn more, and pay tax there instead.
Anon, London

I think it is ridiculous that such large bonuses should be paid to the so called bankers and financial world employees when there are millions around the world who are starving and going without medical help. And at home too. All those homeless and poverty stricken Britons living on the streets without any help from the rich who are getting richer and have all the money to spend on a shameless luxurious lifestyle while all the rest around them go without.
Joy Butler, Wiesbaden

I think it's wrong to assume that just because someone earns a million quid they don't deserve it. If a car salesman sold �10m worth of new cars and was on 10% then they would expect the same amount of money. It's a similar structure for people who work in the financial markets except you can't "lose" money selling new cars. Therein lies the stress.....
James, London

What John McDonnell fails to acknowledge is that someone earning a �1m bonus will immediately hand 40% of it to the taxman. That's �400,000, or the equivalent of about 25 trainee nurses' salaries. Let those who pay more tax than that every year criticise, and the rest keep their petty politics of envy to themselves.
Rob McKenzie, London

Think yourself lucky guys, and all those who have a bonus. I have worked for the same company now for eight years a large mining and quarrying firm and have never had a bonus at Christmas. I think the bonus here is you can come back and work for us after Xmas
andy jones, stourbridge uk

City bonuses are generally earned in extra revenue generated for the company. Rather than taxing something revenue-generating for individuals (and by extension the country as a whole), why don't we fund the NHS by raiding MPs extravagant final-salary pension scheme?
Chris, London

I am a secondary school teacher and my day-to-day life is full of stress and challenges. For this I earn just over �20k. I have no hope of getting on the housing ladder and the Key Worker scheme does not extend to where I live and work. While I'm not saying there shouldn't be earned bonuses, what about the earned bonuses we teachers should get but never do. I love teaching, that is why I come in every day and do the job I do for such appalling wages!
Majella Fergus, Nuneaton

Salaries and bonuses should be made more transparent so people doing the same job either within the same company or another company can compare properly. With the current 'shroud of secrecy' and even threat of instant dismissal should annual bonuses be discussed, there is a huge opportunity for discrimination with regards to gender, race, sexual orientation. From my experience, the banks have only be too pleased to exploit this by only appropriately rewarding those that 'fit' their white, male & subservient image.
tariq patel, london