At the centre of the controversy is Ladbroke's long-term incentive scheme, which was introduced when Mr George became chief executive three years ago and which rewards directors on the performance of the share price of the betting shops, casinos and hotels company.
Even Ladbroke's remuneration committee, headed by John Jackson, chairman of the group, admits the scheme could be over-generous.
The committee will propose at next month's annual general meeting to make the scheme more demanding, mainly through changing the performance measure to a mixture of share price performance and earnings per share growth. The committee also wants the awards to be made in shares rather than cash.
But while the amendments propose restricting the maximum bonus payout to 100 per cent of annual salary, members of the scheme will still see the value of their pay boosted by 35 per cent on the basis of an average performance in the share price.
The current scheme is based on a rolling three-year share price performance which only began to pay off at the end of last year. In the three years from 1994 to 1996 the Ladbroke share price rose 42 per cent, placing the company in 23rd position among the 93 constituents of the FTSE 100 which survived those three years in the index.
A points system for each executive with a value per point of pounds 1.60 for being in the top quarter in terms of share price performance gave Mr George pounds 600,000, and pounds 800,000 shared between three other directors. They were Mike Smith, who received pounds 400,000, Brian Wallace, who got pounds 234,000, and David Jarvis, who got pounds 166,000.
The huge leaps in the pay packets prompted sharp reaction in the City. Paul Heath, leisure sector analyst at UBS, said: "The scheme came into effect at a usefully low point in the share price cycle for the company. Certainly the City does not believe the performance has been achieved by exceptionally good management.
"Shareholders certainly want incentives for the directors but I believe they should be more related to earnings and return on capital rather than share price performance which is not the right yardstick for measuring management performance."
However, the scheme has some supporters. One analyst said: "How else do you deliver shareholder value except in relation to the share price? The concept of total return to investors is now widely accepted."
Even so, other analysts said nobody expected the directors of Ladbroke to return their bonuses if the share price were to go into a tailspin.
The pay details, contained in the latest annual report and accounts, also show that on top of last year's 266 per cent rise in Mr George's pay packet he gained a pounds 40,000 rise in his basic salary to pounds 450,000.
In addition his pension scheme was topped up by a further pounds 279,000. The pay of the four executive directors rose last year from pounds 1.86m to pounds 3.6m.
Mr Jarvis collected pounds 657,000 in 1996. He was paid pounds 98,000 for three months' work in 1995.
Mr Smith, who runs the betting shops chain, collected pounds 846,000 against pounds 399,000 a year earlier. The finance director, Brian Wallace, collected pounds 640,000 versus pounds 265,000.
Separately, compensation payments of pounds 564,000 were paid to two former directors of T&N last year, while the group's chairman, Sir Colin Hope, received an unchanged basic salary of pounds 320,000 for 1996.
William Everitt, the former director of technology who stepped down last April, received pounds 400,000 in compensation for loss of office, while Amar Sabberwal, who retired in December, was paid pounds 164,000 in compensation to bring his total remuneration to pounds 341,000.