FTSE 100 executive pay rises 55%, survey says

http://www.bbc.co.uk/news/business-11649789

An interesting couple of days. Board room pay is up over 50%, there are rumours (denied) about a big company managing to wiggle out of a tax bill that would cover the recent cuts to the welfare bill.

Same old Tories


On Vodaphone:
The assessment related to so-called Controlled Foreign Companies (CFC) liabilities, which applies to firms that are controlled by UK residents but which pay tax on their earnings abroad at a lower rate.
However, an article in the Private Eye estimated the taxpayers' bill for the CFC liabilities and other arrangements "was likely to be at least £6bn" in lost tax.
According to the magazine, a former official familiar with the case described it as an "unbelievable cave-in" by HMRC.
"There is no question of Vodafone having an outstanding tax liability of £6bn. That number is an urban myth."

http://news.sky.com/skynews/Home/Business/Vodafone-Shop-Protest-Over-Unpaid-6bn-Tax-Bill-Oxford-Street-Store-Closed-By-Protesters/Article/201010415777604?lpos=Business_First_Home_Article_Teaser_Region_0&lid=ARTICLE_15777604_Vodafone_Shop_Protest_Over_Unpaid_%3F6bn_Tax_Bill%3A_Oxford_Street_Store_Closed_By_Protesters

Are MPs' interns being exploited?

Are interns exploited?
It's not just MP's interns!
I'm doing an internship because otherwise I'd be doing nothing, so it's good from that point of view.
BUT,
a recruitment agency thinks I could get £10/hour. Right now i'd take minimum wage for a job.
Another agency has offered me an interview to be a recruitment consultant on £20k per year plus bonuses of nearly another £15k. But i wouldn't get it coz i don't want it.
Maybe that's me being greedy, because I don't want that job and i'm not really in a position to refuse.
But my point is that in the face of this i'm actually working on £2/day travel expenses.
Are interns exploited? Yes

Gordy on bonuses

A bit late I know, but I support the idea at least:
"Gordon Brown has pledged tough action to clamp down on excessive remuneration for bankers as part of an international effort to rectify the systemic weakness that led to the global financial crisis.

The prime minister said in an interview with the Financial Times that pay and bonuses should be based on long-term success not short-term speculative gains; banks should “claw back” bankers’ rewards if their performance suffered in subsequent years; and regulators should be able to impose higher capital requirements on financial institutions."

"Mr Brown said he hoped G20 leaders meeting in Pittsburgh this month would agree a “global compact for growth” that would include co-ordinated steps to withdraw stimulus packages and government support for banks; a deal on “trigger points” where countries would be expected to act to address global imbalances such as excessive current account deficits and surpluses; and an agreement on climate change."


He is the man with the ideas, he knows what he's talking about on the economy. A shame that he's unable to transfer his obvious brilliance for economics to politics more widely.

Bankers' pay

Right-ists are out in force (links to follow) to defend the rights of the well-paid to keep all their money without nasty state interference.
What I haven't yet seen is the lefties' case.
So i'll come up with one when I have time.
Not that anyone will read it, but that's another issue.
Help appreciated on that one.
ta.

Oh, and Southend won tonight. Woot

Brown calls for bank bonus reform

So Gordy has now spoken about this, finally. My one criticism would be that it’s a bit late.
“He said that the culture of bank bonuses should be geared towards long-term success and that banks should be able to "claw back" bonuses if the bank later performed poorly.”
Fair enough for me, that rewards should be linked more closely to performance as too often it seems that the two are not linked, at the higher levels at least.

“He called for international co-ordination on the issue, but said he was not in favour of French proposals for a mandatory cap on banker pay.”
International co-ordination is vital, and a failure to do so would undermine the whole exercise. As usual, all eyes will be on America.
I’m not mad keen on the mandatory cap on bankers pay, for a start it’s not right to single out one group over any others. Secondly, how would the cap be decided and enforced?

“While he said the City had "overheated", he declined to support the words of the head of UK watchdog the Financial Services Authority (FSA), Lord Turner, who said in an interview published last week that the financial services sector had "grown beyond a socially reasonable size". Mr Brown said it was important to protect London's status as a world financial hub.”
Shows, I think, that Gordy is still in thrall to the City and is more scared of it than it is of him, which for a Labour prime minister strikes me as the wrong way round.
It’s good to know that at least some progress is being made on this and the sort of externalities which proved problematic are at least being addressed in thought, though perhaps not yet by deed.


“In August, the FSA unveiled a new code that stated bonuses should not be guaranteed for more than a year.
Senior employees should have their bonuses spread over three years under the code, which is due to take effect from January 2010.
The new rules, to link pay more closely with the long-term profitability of banks, are designed to address concerns that big bonuses led to excessive risk-taking at banks which contributed to the financial crisis.”
Sounds very promising, unfortunately it seems that legislation is required to make a more sustainable financial sector, so let’s hope that it runs well and the considerable ability in that sector is not just geared towards getting round the laws.


interesting that the FT editorial is called "Too much of a very good thing". Post on that in due course

High pay stuff

Polly Toynbee on high pay in the City:

[the City is] untouchable, it shows no remorse because it frightens the politicians, not the other way round.

On Capital flight:
"What of the threat that they will all flee London if astronomic pay is challenged? "Hyperbolic nonsense," says Cable, in those deceptively moderate tones that out-smart Labour every time."

"Hector Sants, head of the FSA, replied tartly that capping City pay is the job of government not the regulator. Politicians, he said, were "passing the buck" and it is not the watchdog's job "to bring about social change". Absolutely right. But outsourcing politics is now the fashion: quangos are the place to deposit anything politically difficult, while government loses belief in its own powers."

Now that is interesting. While many politicians are being criticised for being bland managerial-types with no ideology, this would make sense. Because the ideology is kept beneath the surface, they feel the need to 'outsource' politics to escape having to make difficult and potentially decisive decisions. Shame, some strength of (lefty) will is just what's needed.

"The idea of a high pay commission has had plenty of support from Labour and Lib Dem MPs, including Jon Cruddas and Vince Cable. Cheekily, Compass asked Osborne to sign up: don't hold your breath. The official Labour response was dismal: "It's a return to the 1970s" was the predictable objection, in step with the Times leader. But no one is suggesting a prices and income policy. The idea is to set benchmarks so companies consider a reasonable ratio between top and bottom pay: FTSE 100 ratios have shot up from 15:1 to 75:1 in just 20 years."
Now that is interesting, and explains New Labour down to the ground, the fear of the ghost of Old Labour. The present leadership are so scared of being Old Labour they are willing to go to almost any end to avoid it, costing vital core support.

Toynbee's assertion that information on pay would open up and transparency element is a welcome contribution. As she puts it "Most people on £42,000 don't feel rich because they don't know they are in the top 10%"
Interesting.
Anything that makes a more equal society is to be welcomed

Capping high pay

The facts are stark: an employee working a 40 hour week, earning the minimum wage would have to work for around 226 years to receive the same remuneration as a FTSE 100 CEO does in just one year.

Bloke in the office thinks Labour will either introduce a maximum wage or a quango or body to look into it, or the publication of wages.
Haven't yet had time to look into this at length, but the lefty in me likes the idea.

Working in a supermaket

I know I shouldn't, but I was reading something in the Daily Mail.
I've worked in a supermarket, part time. It was horrible. The staff were treated like crap, we weren't allowed to talk during the shift other than to help customers. All I was doing was staking shelves.
I'm lucky that I didn't have to stay there long, and I wouldn't want to go back. I've had other simular jobs, working in what i called the 'arse end of the service industry' and others have agreed with that assessment.
What struck me about the article was how horrible and rude most people are, how people expect things to be landed on their plates, not only from the people mentioned in the article but the comments section too.

Benefit claimants

Claimants are still seen as 'scroungers', the public are happy for people to be very rich, people still believe in 'deserving' and 'undeserving' poor, "Despite negative perceptions of poorer people, however, there was strong underlying support for a progressive tax system. The research identified a public appetite for "more radical action on pay and taxation at the top of the spectrum"."
"most people on middle incomes complained that the system was less generous to them than other groups."

interesting, mixed results. It seems there is some appitite for greater distribution, too much belief in scroungers, still a belief in meritocracy, and a desire for everyone ELSE to pay more tax.
We're an odd lot.
I'm not sure these findings actually tell us anything really

Pay, Banker's, public sector and the rich in general

Peston makes an very interesting point:
how much should people be paid?
As a lefty, i'm pretty much against big pay packets or bonuses for anyone. Hester may be an exception. His contract states that failure will not be rewarded (finally!), and his big cheque is dependent on his meeting certain targets which include getting a big profit on tax-payer investment and therefore significantly improving the public finances.
Surely all these things are the right things to do, and should have been done ages ago. It's been obvious to me that there has been a problem in bankers' pay for a long time, so others should have been able to see it if i could.
On top of that, a bloke taking home millions while millions are unemployed is an issue that hasn't been to the front in the current crisis, but that's no surprise