Today is the official launch of an independent inquiry into high pay. The aptly named High Pay Commission has been established by Compass and is supported by the Joseph Rowntree Charitable Trust. To mark the launch the commission conducted private polling with YouGov which had some remarkable results.
Zoe Gannon is head of research and clerk to the High Pay Commission
Today is the official launch of an independent inquiry into high pay. The aptly named High Pay Commission has been established by Compass and is supported by the Joseph Rowntree Charitable Trust. To mark the launch the commission conducted private polling with YouGov which had some remarkable results.
At the most basic they show that the public think the boss of a FTSE 100 company should be paid significantly less than they are – just 1 per cent thought that the CEO should be paid more than £4million (the current average total pay of a CEO in a FTSE 100 company is £4.9 million according to Income Data Services).
Perhaps more interestingly, the poll also revealed hardly anyone realises how much the average CEO of a leading company is paid – only 9 per cent of those polled correctly estimated it.
When it came to guessing how much these top bosses earned, 63 per cent of people either didn’t know or thought that they were paid less than £1million – in reality they are paid nearly five times that amount – and 4 per cent thought the boss of a FTSE 100 company was paid less that £50,000.
Polling is an inaccurate science but at the very least these results show a serious disconnect between the pay at the very top and the public at large. There is a growing public interest in top pay in the private sector and while the government has set up an inquiry into high pay in the public sector, under Will Hutton, this will only ever show half the story.
No one is saying that being a CEO or banker is an easy job but the fact that over the last ten years CEO pay for FTSE 100 companies has increased by 160 per cent and yet the value of these companies has declined by 19 per cent. There is much theorising over high pay but very few answers to the big question – are they worth it?
Today Barclays bank announces its bonus pool which estimates suggest will include an extra £1.5 billion to pay its 25,000 staff on top of the £3bn pay and bonus pot that had been amassed half way through the year. A trading statement by Barclays due today is expected to show a downturn in investment banking profits in the third quarter, matching the recent results from many of its rivals.
Despite the downturn this will see huge bonuses rewarded to the very people who took the big risks with our economy. Over the coming months there will be more announcements of banks’ bonus pools – with barely a day going by without a news story on high pay – so it is timely that this independent inquiry is taking place now.
It is chaired by Deborah Hargreaves, former business editor or the Guardian and Financial Times. She will be joined by a panel of commissioners from business, trade unions and academia. These include Lord Richard Newby, Liberal Democrat peer; Brian Bailey, director of pensions for the West Midlands Pension Fund; Robert Talbut, CIO of Royal London Asset Management; Frances O’Grady, deputy general secretary of the TUC; and Professor Michael Taylor, former Director of Christian Aid.
The commission will run for a year and is tasked with exploring the drivers behind the increase in pay and looking at reforms which could mitigate or reduce this trend.
If you want to find out more or get involved the commission has issued a call for evidence; to submit evidence or have your say log on to highpaycommission.co.uk/submit-evidence
51 Responses to “Public unaware of just how much those at the very top are paid”
Shamik Das
Thanks guy! Quite incredible findings – 1 in 25 of those polled think a FTSE 100 boss is on less than £50k!
Press Not Sorry
RT @OtherTPA: Public unaware of just how much those at the very top are paid: http://bit.ly/a0iy95 by @CompassOffice's Zoe Gannon (via @ …
13eastie
Spin and the politics of envy…
Wide sections of the public are ignorant? No s***, Sherlock!
If you know anything about public companies at all, you would know that directors’ remuneration is always invariably the first item on the agenda at AGM’s. Such pay is a matter of public record, and one on which shareholders are entitled to vote as individuals and on a case-by-case basis. EARNINGS ARE TANSPARENT, THEY COST THE TAX-PAYER NOTHING (QUITE THE CONTARY, IN FACT) AND THEY ARE OBJECTIVELY PERFORMANCE-RELATED.
Govt, public sector and QUANGO’s like the BBC, on the other hand, are funded by the tax-payer, and they do not operate in a free market, so there is no incentive to offer price competition or value-for-money, especially re. salaries. The BBC keeps its highest salaries secret from the very tax-payers who foot the bill for them.
“the values of these [FTSE100] companies has declined 9%”
Indeed, this is one of many negative indicators traceable over the last decade of Labour destruction. See also: unemployment; the pound; national debt; budget deficit. For all of which, many thanks, Gordon!
All the commissioners on the HPC are in the top 1% of earners, by the way.
Trebles all round!
merthyr_bill
just a quick word on stats…”4 per cent thought the boss of a FTSE 100 company was paid less that £50,000″
we cannot glean that from the evidence. maybe 4% reported that as their answer to a questionnaire or survey. but 4% is very low and within the noise of people taking the mickey. for this sort of survey you can ignore anything below about 10% as a rule. 4 out of 100 people are annoyed at being approached in the street or phoned up and give a stupid answer.
as for the rest of the article it just seems like gibberish. certainly poorly explained, not showing a level of understanding of stats and in places just bizarre. for example “When it came to guessing how much these top bosses earned, 63 per cent of people either didn’t know or thought that they were paid less than £1million”. this doesn’t really mean anything in english. I would certainly expect better from one of my post 16 students or a brighter one of the 10-14 year olds.
merthyr_bill
“over the last ten years CEO pay for FTSE 100 companies has increased by 160 per cent and yet the value of these companies has declined by 19 per cent.”
the CEOs are working in an incredibly business-hostile atmosphere. to only have your company fall in value by 19% over 3 terms of labour government seems extraordinary and well worth a 160% pay rise. history shows us that. they have taken their companies through the terror and now they are being rewarded. the sunny uplands are on the horizon!