M&S pay-offs for sacked executives have cost £3m

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The Independent Online

The cost of axing the four executive directors charged with destroying Marks & Spencer's recovery has hit £3m, it emerged yesterday.

The cost of axing the four executive directors charged with destroying Marks & Spencer's recovery has hit £3m, it emerged yesterday.

The retailer, under siege from Philip Green, revealed it had awarded David Norgrove, its former clothing director, a £754,000 pay-off - more than twice the amount predicted when the group sacked the former civil servant in January.

Mr Norgrove, who joined the group in 1988, was its highest paid executive last year, receiving a total of £1.1m. He has amassed a pension pot worth £2.8m - £128,000 a year.

M&S also confirmed that Vittorio Radice, who leaves today just 15 months after joining, will receive as much as £828,000 in compensation. Mr Radice, hired to lead the group's assault on the home furnishings market, briefly replaced Mr Norgrove as head of clothing. Mr Radice's final payout will depend on whether the retailer managed to claw back any clothing or home sales during the first three months of its financial year, a spokeswoman said. His compensation package included £485,000 in lieu of his salary, a pension supplement £121,250 and a notional bonus of £97,000. He also received £11,658 to make up for not being able to take his holiday entitlement last year.

Since January, M&S has paid out £2.98m to the four executive directors behind its poor like-for-like sales figures. Roger Holmes, the chief executive, and Luc Vandevelde, the chairman - ousted last week - were paid £820,000 and £580,000 respectively. It has also paid an undisclosed amount of compensation to Steve Longdon, sacked last month as head of womenswear.

The group's annual report, published yesterday, carries messages from "beyond the grave" from Messrs Vandevelde and Holmes. Mr Vandevelde claimed it was "building this next stage [of the recovery] on secure foundations" while Mr Holmes highlighted his decision to promote Mr Radice and Maurice Helfgott, whose brief tenure as head of the struggling food arm ended this week. Mr Helfgott will now look after menswear, home and childrenswear.

The report also revealed the company had gone back on its pledge in January not to pay bonuses to directors. Laurel Powers-Freeling, who heads its money division, was paid £35,000 for "successfully launching the &more combined credit and loyalty card", a spokeswoman said.

Separately, Sir David Sieff, the last member of the M&S founding dynasties to sit on its board, attacked the former management team. He told Retail Week: "The principles of the business have been totally forgotten."

Meanwhile, Mr Green continued to mull over his options yesterday. His advisers have promised to sound out major M&S shareholders by today, although as of last night at least one had yet to hear from him.

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