Saturday, October 29, 2011

Cameron slams fat cat bosses as it is revealed they have awarded themselves a massive 49 per cent pay hike


  • City firms to pay out £4.2billion this year in bonuses

  • Shell making £4.4billion in three months as oil prices soar

  • Average earnings has now hit £2.7million



  • David Cameron has slammed Britain's top bosses for awarding themselves a massive 49 per cent pay rise in the last year.
    Business chiefs at the UK’s top 100 companies can now expect to take home an average £2.7million as households suffer the biggest squeeze on incomes since the 1920s, according to new figures.
    The massive salaries are 113 times the national average of £24,000 for a worker in the private sector, where salaries have risen just three per cent in the last year.
    Anger: David Cameron, in Perth Australia for the Commonwealth Heads of Government Meeting, considers the news about fat cat pay from the UK
    Anger: David Cameron, in Perth, Australia today for the Commonwealth Heads of Government Meeting, considers the news about fat cat pay from the UK
    Speaking from the Commonwealth Heads of Government Meeting in Perth, Australia, the Prime Minister said: 'There needs to be responsibility. Boards have got to think when they are making pay awards, is this the responsible thing to do?
    'We need all these figures published and known so that we can compare and contrast, so shareholders know what they are paying for.
    'We need accountability to strengthen the hands of shareholders so that they feel they are taking responsibility for remuneration in the boardroom.
    'This is a concerning report, particularly at a time when household budgets are very tight and people have difficult circumstances.'
    Enlarge   The City of London: Fat cat bosses and bankers can expect bumper bonuses despite the rest of Britain feeling the squeeze
    The City of London: Fat cat bosses and bankers can expect bumper bonuses despite the rest of Britain feeling the squeeze
    He called for 'transparency, accountability, responsibility' in boardroom pay, urging that all awards must be justifiable.
    'Everyone, whether they are in public life, whether they are in private enterprise, they all need to be able to justify the decisions they make about pay,' he added.
    The extravagant pay packages enjoyed by every member of the boardroom, from the chief executive down to far less high-profile roles, were revealed in research by Incomes Data Services (IDS).
    In fact according to the report, chief executives and finance directors – usually considered the number two at a firm – did not do as well as more junior staff.
    The average chief executive saw their total payout increase by 43.5 per cent to £3,855,172, while the rise for a finance director was up 34.1 per cent to £2,001,515.
    Other directors enjoyed the largest rise, as they took home 66.5 per cent more in pay and perks, to the tune of £2,260,033 on average.
    Backlash: The Occupy London protest continues in the square at St Paul's Cathedral, with many very angry about capitalist Britain
    Backlash: The Occupy London protest continues in the square at St Paul's Cathedral, with many very angry about capitalist Britain
    The bonus element of the average executive pay packet increased by 23 per cent, from £737,624 in 2010 to £906,044.
    Former Liberal Democrat Treasury spokesman Lord Oakeshott said: ‘These greedy bosses sit on each others’ remuneration committees and wave through each others’ offensive pay rises.
    An average rise of 49 per cent includes vast rewards for failure while employees, shareholders and customers suffer.
    Fury: Lord Oakeshott says a minority are getting 'vast rewards for failure while employees, shareholders and customers suffer'
    Fury: Lord Oakeshott says a minority are getting 'vast rewards for failure while employees, shareholders and customers suffer'
    ‘Many FTSE bosses then have the brass neck to whine about paying 50 per cent tax.
    'It’s high time they showed leadership and restraint.’
    The revelation on corporate pay comes as Shell reported bumper profits of £4.4billion in just three months, after reaping the benefit of the high oil prices hitting motorists at the petrol pumps.
    In a further insult to struggling families, a separate survey revealed City firms will pay out £4.2billion this year in bonuses alone.
    The sum, revealed by City think tank the Centre for Economics and Business Research will be handed out despite pledges by successive governments to crack down on the culture of corporate excess.
    Meanwhile, ordinary households are an average of £15 a week worse off than a year ago, thanks to spiralling bills and pay squeezes.
    Earlier this week the governor of the Bank of England Mervyn King said workers in Britain had been hit by the biggest fall in living standards ‘in living memory’.

    TOP EARNING BOSSES

    Mick Davis - Chief Executive of Xstrata
    Bart Becht, CEO of Reckitt Benckiser
    Mick Davis, above left (Xstrata)
    £18,426,105
    Bart Becht, above right (Reckitt Benkiser)
    £17,879,000

    Michael Spencer (ICAP)
    £13,419,619
    Sir Terry Leahy (Tesco)
    £12,038,303
    Tom Albanese (Rio Tinto)
    £11,623,162
    Sir Martin Sorrell
    (WPP Group)
    £8,949,985
    Todd Kozel (Gulf Keystone Petroleum)
    £8,913,223
    Don Robert (Experian)
    £8,601,984
    Edward Bonham Carter (Jupiter Fund Management)
    £8,003,641
    Dame Marjorie Scardino (Pearson)
    £8,003,641
    The Income Data Services report on fat cat pay used information from the latest available published accounts of FTSE100 companies, for the financial year ending between February 2010 and April 2011.
    Author Steve Tatton said the companies would find it hard to explain why executives were being so handsomely rewarded while their employees struggle to get by.
    ‘The pay gap between the boardroom and the shop floor does not yet show any signs of closing,’ he said.
    Brendan Barber, general secretary of the TUC, added that the boardroom increases amounted to a ‘brazen stitch-up’.
    He said: ‘With the FTSE 100 down on last year and most staff getting pay rises of less than two per cent, these bumper settlements prove that CEO pay bears no resemblance to performance or economic reality.’
    One of the key factors behind the inflation squeeze on household finances has been the high price of oil, which has been above $100 per barrel all year.
    GRAPHIC SHELL.jpg
    But high fuel costs – exacerbated by the unrest in the Middle East – spelled good news for Shell.
    The oil giant made £4.4billion in the third quarter of the year, the equivalent of around £48million per day.
    Petrol prices are up almost 18 per cent since last September, according to data collected by Asda, adding to the pressure on incomes.
    The £4.2billion bonus pool shared out in London’s financial district is actually 38 per cent down on the previous year and a long way below the £11.6billion paid out in 2007/08, just before the credit crunch ravaged the global economy.

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