Will Hutton in The Guardian on the subject of Stephen Hester's £1 million salary + £1 million bonus for meeting targets at the Royal Bank of Scotland:
There is no inbuilt sense of proportionality in pay: no determined effort to link exceptional reward with exceptional contribution; no rigorous effort to separate out the luck of being in the right place at the right time from genuine effort and innovation; no mechanism to require executives to have some stake at risk, or some "skin in the game" to use Warren Buffett's phrase; and a process in which the guiding principle is to give in to empty threats from executive teams.
It is a one-way street in which executives in any circumstances always get more bucks or mega-bucks – never fewer bucks.
And the by-line reads: Will Hutton chaired a government inquiry into top pay in the public sector, published in 2011
Now, Hester turned down the bonus, but a base salary of £1 million is still an outrageous sum of money for just running what is effectively a government department, there is no particular skill involved. To be fair to Hester, RBS is a huge organisation (150,000 employees) and while he was in charge, it appears to have made modest profits and hasn't gone bankrupt or anything.
So let's look at Will Hutton's record shall we?
He was paid (or paid himself) around £180,000 a year for running a quango called The Work Foundation (formerly The Industrial Society), which had 43 employees and went horribly bankrupt in 2010.
Saturday, 11 February 2012
Will Hutton speaks with forked tongue: shock.
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6 comments:
I don’t understand people like Hutton. How he can write as he does after the Work Foundation debacle I don’t know. Talk about thick-skinned.
It's a total non-issue. A million quid when you're dealing with billions of pounds is just chump change. If it gets you the right person and they improve the company it will pay for itself many, many times over.
That's what people can't grasp. They compare them with teachers and while the effect of a teacher on a pupil might be quite considerable, in the end, they're only dealing with 30-odd of them per year (and sub-par teachers never get fired, retrained or anything else).
AKH, perhaps WH genuinely thinks he's worth it? Some people do.
TS, yes, agreed. if it were just a question of giving one man £1 million for turning round a big, taxpayer owned bank, I wouldn't mind. That wasn't what the post was about anyway, it was about Will Hutton's insufferable cheek.
On the topic of bankers' pay, it's not just £1 million a year though is it? These top few hundred bankers were helping themselves to £5 - £10 billion quid a year for the past decade, made a complete mess of it, were bailed out the governments and continue to pay themselves these bonuses regardless.
Mark,
Sorry - I did threadjack a little, there.
Hutton's one of those BBC establishment types that will always be in a job somewhere in some think tank or some unimportant part of government. No-one's going to hire him to run defence, but an Oxford college known for producing poets can't cause too much harm.
Reminds me of the disconnect that allows pols to claim that the Olympics will benefit London, when it only benefits land (and business) owners.
Anon, that's off-topic, and non-landowners do get some of the benefit of infrastructure spending or economic growth. It might be only a fifth, but it's not nothing.
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