Lord Sugar has attacked politicians from all parties for criticising the large bonuses awarded to Britain's senior bankers.
The Labour peer accused MPs and fellow peers of "jumping on the bandwagon of bank bashing", which served only to "depress the business environment" in the City.
Speaking during a debate on the Budget in the House of Lords on Thursday, the star of the Apprentice TV programme was critical of his party leader's decision to condemn moves to award RBS chief executive Stephen Hester a bonus of almost £1m.
"The reality is carry on doing that and these people will go and get a job in a different type of company where the culture of paying bonuses is not frowned upon," he said.
Lord Sugar warned that criticism of bonuses would cause talented executives to quit the banking sector and go work in other industries, damaging the chances of the taxpayer seeing a return on their investment when the government was forced to bail out the banking industry.
"Pay peanuts and you will get monkeys," he said. "Change the record, start to install some confidence in the market place."
Both Labour and the coalition have been critical of large bonuses in state-backed banks, and Hester eventually turned down his pay out in the face of public and political pressure.
But Miliband has gone further than David Cameron in calling for bonuses to be reigned in at banks such as Barclays, which did not receive a direct taxpayer-funded bail out.
During his speech Lord Sugar was heavily critical of George Osborne's Budget, which he said had failed to put "fuel in the tank of the economy" as had been previously promised. He also warned of rising unemployment.