Eddington departs BA with doubled pay packet

Rod Eddington, the outgoing chief executive of British Airways, saw his pay increase by almost 60 per cent last year to £917,000 as he received the maximum annual bonus in recognition of his success in reviving the airline's fortunes.

Rod Eddington, the outgoing chief executive of British Airways, saw his pay increase by almost 60 per cent last year to £917,000 as he received the maximum annual bonus in recognition of his success in reviving the airline's fortunes.

The bonus of £300,000 reflected Mr Eddington's "exceptional performance over his period of service" as well as the "excellent results achieved in difficult conditions during the year in review" even though BA failed to achieve the 10 per cent operating margin that would normally trigger the maximum payout. BA made a pre-tax profit of £415m and an operating profit of £540m, giving it an operating margin for the year of 6.9 per cent. Mr Eddington's pension pot increased by £373,000 to £1.35m, entitling him to an annual income in retirement of £96,883.

BA's annual report and accounts also reveals that Willie Walsh, the former Aer Lingus chief executive who takes over from Mr Eddington in September, will be handsomely rewarded if he maintains the progress. Under BA's new remuneration policy the maximum annual bonus will increase from 50 per cent of salary to 100 per cent for its most senior executives. It will be paid in deferred shares.

BA's long-term incentive plan is also being replaced by a performance share plan under which awards worth up to 150 per cent of salary can be made to the chief executive. This means that Mr Walsh's pay package could be in the region of £2m a year if maximum performance targets are achieved. The pay last year of BA's two other executive board members, the operations director, Mike Street, and the finance director, John Rishton, increased to £453,000 and £466,000 respectively, while the chairman, Martin Broughton, earned £229,000.