Barclays cut its staff bonuses by 7% last year even though profits jumped by a better than expected 32% as bad charges tumbled everywhere except Spain.Pre-tax profits in 2010 rose to £6.1bn, up from £4.59bn, and well ahead of forecasts of about £5.5bn. The bank said the increase came despite "historically low interest rates; sluggish volumes in many market segments; and considerable regulatory uncertainty". Total group income rose 8% to £31.4bn,Bad debts tumbled by 30% to £5.7bn with a sharp decrease in impairment at Barclays Capital partially offset by a significant increase in Barclays Corporate impairment in Spain. Barclays paid out £3.4bn in performance awards, or bonuses, down 7% on 2009. Bonuses at Barclays Capital were down 12%, though salaries also rose sharply as compensation. Salary costs overall increased 13% to £8.8bn.Barclays has also introduced a Contingent Capital Plan (CoCo) as a part of deferred compensation arrangements for all senior staff, which will hold back payment for three years and be tied in with growth in the bank's reserves.Barclays Capital, the investment banking business, made a doubled profit before tax of £4.78bn, though underlying profits rose by just 2%. Income was £13.6bn.Global Retail Banking's profit before tax was £1.83bn (2009: £1.82bn). Barclays Corporate made a loss before tax of £631m (2009: profit of £157m) reflecting hefty bad debt charges in Spain. The charge in Spain was nearly £900m. Chief executive Bob Diamond said bonus payments this year had been influenced by last week's Project Merlin deal with the government. This traded off bonus payments against commitments to lending from the banks. "We are committed to demonstrating that we are both responsible in our compensation decisions and practices and that we take our regulatory obligations and UK government commitments seriously," he said."In particular, our overall performance awards for 2010 have been directly influenced by the commitments that we have made under Project Merlin."Bob Diamond also indicated that tougher regulations will result in lower returns in future with a return on equity of 13% now the target. "We have had a good start to 2011, benefitting from higher volumes. Group income and profit before tax in January were ahead of 2010 average monthly run rates. We continue to see good impairment trends across the group and are cautiously optimistic that we will see a further improvement in 2011, albeit at a lower rate than in 2010," finance director Chris Lucas added.A final dividend of 2.5p per share makes 5.5p for the year (2009: 2.5p).