Ed Davey: no excessive pay to managers

[Pinky 1]

The chief executive of Royal Mail is paid three times more than the Prime Minister, new figures will show today.

Moya Greene is thought to have been paid a basic salary of £500,000 since her appointment in July 2010, despite a slump in the company's core letters business and fears about it's long term future.

The news came as Ed Davey, the Postal Services minister, warned that he would not allow managers to make “excessive profits” from the privatisation of Royal Mail, which passed into law on Monday.

He said: “It is our intention that we get the best value for money for the taxpayer. It surely follows from that that we do not want to see someone making excessive and unfair profits as a result of this process.”

Royal Mail's annual report, which will be unveiled today, are likely to provoke a fresh row over executive pay. Adam Crozier, the former chief executive, received £2.4million, including a basic salary of £633,000 and a long-term bonus, in his last year in charge, 2009/10.

The remuneration of Ms Greene, who took over in July 2010, has never been revealed, although it is thought that she is paid a basic salary of just less than £500,000. That would mean that she is paid more than three times the annual £142,500 salary paid to David Cameron, the Prime Minister.

However, her full pay is likely to be much higher when pension contributions and other perks are taken into account.

The news came as plans to privatise Royal Mail became law after they were given royal assent by the Queen.

In an interview with The Daily Telegraph, Mr Davey warned that he would not allow managers to “excessive profits” from the sell-off.

He said he was well aware of the criticism levelled at the Government’s sale of defence firm Qinetiq, the last state business to be sold off and floated.

A scathing 2007 report by the National Audit Office found that the top 10 managers at QinetiQ received £107million after investing just £500,000 between them.

Mr Davey said he wanted to ensure that the taxpayer was not “ripped off” from any sale and managers were not able to profit “unreasonably”.

He added: “I want to learn from National Audit Office reports and anything else that is out there, so when we get to that point which is some way off we will have learnt from that, and the mistakes of previous Governments and ministers.”

Mr Davey said he was considering a flotation on the stock market or a private sale to a trade buyer or a private equity company. Up to 10 per cent of the shares would be handed to postal workers, and the post office network will be kept in state hands.

He said that he was “relaxed” about a foreign company buying Royal Mail, pointing out that British investors own 30 per cent of Deutsche Post.

He added: “We are keeping flexibility for the sale – and we are not going to rush things. We are going to do things properly. We are not selling the family silver – we are effectively insuring the family silver. This is a privatisation with a difference.

“We have got employee shares, we are securing the pension benefits for Royal Mail employees past and present, and to mutualise the post office network.”

The sell-off will depend on the European Union approving an injection of up to £10billion of taxpayers' money into the business, to cover the cost of clearing its £8.4 billion pension deficit and pay off loans.

Mr Davey suggested that this might not happen for several years. He said: "We could IPO it, have a trade sale, private equity investment, we could do it in one or two stages.

"If you were to sell your house, your company, would you tell people and signal it several years before potentially how you were going to do it.”

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[happyhippo]

Every manager and every minister involved in the privatisation will have their nose in the trough. This is why Moya was brought over from Canada in the first place she knows the process of selling out a nationalised mail company very well. The only losers will be posties and the public. Sad times ahead

[britwrit]

Mr Davey suggested that this might not happen for several years. He said: "We could IPO it, have a trade sale, private equity investment, we could do it in one or two stages.
"If you were to sell your house, your company, would you tell people and signal it several years before potentially how you were going to do it.”
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"Yes," Davey continued. "We're just going to play it all by ear. Tra-la-la. Maybe we'll hold a big lottery and the winner gets to own the whole thing lock, stock and barrel. Wouldn't that be exciting? Or, who knows? Maybe magical elves will appear from out of the sky and that whole pension shortfall will wondrously disappear!"

The minister then threw back his head and laughed self-deprecatingly.

"Hey, don't ask me what's going on. I just work here!"

[Wessex]

Well it looks like he envisages the management making big bucks just as I have long suspected.I wonder how he proposes stopping them.

[Eric]

Mr Davey suggested that this might not happen for several years. He said: "We could IPO it, have a trade sale, private equity investment, we could do it in one or two stages.
"If you were to sell your house, your company, would you tell people and signal it several years before potentially how you were going to do it.”
http://www.telegraph.co.uk/news/uknews/ ... ation.html" onclick="window.open(this.href);return false;

"Yes," Davey continued. "We're just going to play it all by ear. Tra-la-la. Maybe we'll hold a big lottery and the winner gets to own the whole thing lock, stock and barrel. Wouldn't that be exciting? Or, who knows? Maybe magical elves will appear from out of the sky and that whole pension shortfall will wondrously disappear!"

The minister then threw back his head and laughed self-deprecatingly.

"Hey, don't ask me what's going on. I just work here!"

Frighteningly accurate, britwit, they've just slashed the pension deficit to £4.5 million!

[Pinky 1]

Mr Davey suggested that this might not happen for several years. He said: "We could IPO it, have a trade sale, private equity investment, we could do it in one or two stages.
"If you were to sell your house, your company, would you tell people and signal it several years before potentially how you were going to do it.”
http://www.telegraph.co.uk/news/uknews/ ... ation.html" onclick="window.open(this.href);return false;

"Yes," Davey continued. "We're just going to play it all by ear. Tra-la-la. Maybe we'll hold a big lottery and the winner gets to own the whole thing lock, stock and barrel. Wouldn't that be exciting? Or, who knows? Maybe magical elves will appear from out of the sky and that whole pension shortfall will wondrously disappear!"

The minister then threw back his head and laughed self-deprecatingly.

"Hey, don't ask me what's going on. I just work here!"

Frighteningly accurate, britwit, they've just slashed the pension deficit to £4.5 million!

Oh i wish, i think you'll find that it's £4.5 BILLION Eric ..........

[Eric]

Ooops!

[Straight4ward]

Nonetheless, still pretty impressive. To reduce the pension deficit from 8.4 billion to 4.5 billion in a single pen stroke.

You've gotta admire the bean counters that came up with this idea. An overnight saving of 3.9 billion.

If they get paid by results then they're in for one truly humungeous bonus, with bells on!

[britwrit]

Wow, you're right. From The Guardian today....

Royal Mail also revealed that its pension deficit had fallen from £8bn to £4.5bn following the government decision to change the inflation measure from RPI to CPI, as well as an increase in asset values.

http://www.guardian.co.uk/business/2011 ... -mail-loss

[jafferpants]

Nonetheless, still pretty impressive. To reduce the pension deficit from 8.4 billion to 4.5 billion in a single pen stroke.

You've gotta admire the bean counters that came up with this idea. An overnight saving of 3.9 billion.

If they get paid by results then they're in for one truly humungeous bonus, with bells on!

There's no magic involved there mate. The deficit has halved because they no longer have to increase the pension by the rpi index so the liabilities have fallen respectivley. Simples

[Straight4ward]

Oh dear, looks like my heavy-handed attempt at wit failed miserably.
Sorry jafferpants, don't take me too seriously.

[fishtank]

Didn't they say "no excessive pay to bankers" a while back....
How did that work out?

[DGP1]

Didn't they say "no excessive pay to bankers" a while back....
How did that work out?

What about the overhaul of the NHS?? or Weekly bin collections??

[skull]

Well it looks like he envisages the management making big bucks just as I have long suspected.I wonder how he proposes stopping them.

They have the power to do it . They've had the bankers quaking in their boots . .

[Wessex]

Well it looks like he envisages the management making big bucks just as I have long suspected.I wonder how he proposes stopping them.

They have the power to do it . They've had the bankers quaking in their boots . .

Thanks , I feel much reassured