Pay gap widens as boardroom salaries grow
Wednesday 01 September 1999
That is the fifth year in succession that the average increase for senior executives has been in double figures and substantially ahead of the rises paid to the UK workforce generally. The increase is more than eight times the rate of inflation - around 1.3 per cent - and comes as earnings in the economy as a whole are rising less than 5 per cent.
News of the continuing inflation in directors' pay emerges two weeks before the annual Trades Union Congress where last year the then president John Edmonds famously described boardroom "fat cats" as "greedy bastards".
The union-funded research organisation traced 332 directors earning pounds 500,000 or more, including 79 receiving more than pounds 1m and three on more than pounds 5m.
Researchers said that while "fat cattery" appeared to be on the decline, new rules applying to private firms meant there was less information forthcoming.
Last year's average boardroom increase, according to the LRD, was 15 per cent, whereas over the previous year it was 16 per cent and four years ago it was 10 per cent.
The biggest leap in remuneration found by the LRD was made by David Gruber, formerly of MEPC property group. Mr Gruber, who has since left the company, received a pounds 5,182,673 bonus with a final salary of just over pounds 339,000. His total pay packet of pounds 5,521,687 represented a 1,287.4 per cent gain on the year before.
Second in the pay-rise league came the 129.2 per cent increase awarded to Sir Dominic Cadbury, chairman of soft drinks and confectionery group Cadbury-Schweppes. This rise took him to pounds 1.54m, largely as a result of a boost to his long-term performance bonus.
Greg Dyke, the new director general of the BBC, received a 107 per cent increase in his last full year at Pearson, the media group, taking him to pounds 768,000 a year.
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