Call for watchdog to control soaring executive pay

( ALAN DAVIDSON)

A permanent body to investigate and report on levels of executive pay which have now reached "stratospheric" levels should be set up by the Government, an inquiry concluded today.

The High Pay Commission reveals the pay of top executives has soared by more than 4,000 per cent in 30 years, undermining productivity and "damaging" trust in British business.

It recommends that a body should be established with access to Revenue & Customs data on pay to monitor trends at the top of the income distribution and report to ministers.

As i reported yesterday, the Commission also calls for companies to be forced to publish details of the pay gap between top executives and their average employees. It also recommends that workers should be represented on remuneration committees.

The Government said the recommendations would be fed into its own ongoing review of executive pay.

"Many of the options we are consulting on are reflected in the High Pay Commission's final report and we welcome their contribution to this important debate," said Vince Cable, the Business Secretary.

"There is widespread consensus, not just among the public but in the business community, that this is unacceptable and is undermining the credibility of our markets-based system. What I'm working towards is responsible capitalism where rewards are properly aligned with performance."

Labour also welcomed the report. "On each of these proposals, the High Pay Commission's report backs the approach which Labour has taken," said Chuka Umunna, the shadow Business Secretary.

A poll of more than 2,000 members of the public found that four out of five believed pay and bonuses for top executives were out of control.