Business

Large salary packages from Bauspar bosses remain unchallenged

‘Let’s go for a few beers’: The fat cat from Skipton’s building society has been given an easy ride over a huge pay rise to £1.3million at the annual general meeting

  • Bauspar bosses continue to look forward to salary increases
  • Pay packages from the big bosses are consistently waved with little revolt
  • But the customers still get a rotten savings offer

Easy money: Skipton boss David Cutter was handed £1.3million

Many Bauspar bosses were happy about inflation-dampening salary increases last year, although most customers concluded a lazy savings contract.

A mix of customer apathy and “speed dial” forms rigged in favor of companies at their annual shareholders’ meetings means this generosity continues to go unchallenged. In recent days, the 2021 pay packages for bosses at a number of major companies, including Coventry, Skipton and Yorkshire, have been waved through by members with just a wave of disapproval.

Like the shareholders of listed companies, the members of the building society have the right to vote on a number of matters at the annual general meeting. These include the appointment or re-appointment of directors and the remuneration granted to directors for the past financial year. Customers can vote online, by mail, in a branch or at the meeting themselves.

But most customers do not vote on individual issues such as executive compensation. Instead, they use a “snapshot” approving all resolutions of the meeting, including a thumbs-up for executive and non-executive directors’ pay.

The Building Society Members Association has long called for a ban on the practice, warning members to “never use the infamous speed dial.”

Last month, The Mail on Sunday revealed that 13 CEOs of the company received double-digit increases in their compensation for 2021.

The MoS attended the Skipton’s annual meeting last week to gauge customer sentiment. Why the Skipton? Because CEO David Cutter received £1,309,000 in salaries and bonuses last year – compared to £622,000 for 2020, an increase of almost 103 per cent.

Just 5,700 members voted against awarding Cutter and his followers, while 52,836 voted in favor – 5 percent of Skipton’s million voting customers.

Cutter stepped down at the meeting after 13 lucrative years as chief executive, of which he has pocketed £8,334,000 over the past five years. Although some contestants raised concerns about pay, Cutter had an easy ride. Within ten minutes of the vote at Skipton’s headquarters, he walked into the pub and told The Mail on Sunday: “We’re all going for a few pints.”

Geoffrey Beckett, 84, attended the meeting. He thinks it’s pointless to vote against board salaries.

He says: “Building societies have had high executive salaries for years, but we farmers can do little about it. So few vote against that it’s always nodded through.’

As profits and executive pay soar at Skipton, savings rates remain near record lows. Savers get just £5.50 for every £10,000 in an easily accessible Skipton savings account or Isa.

Eddie and Kate Padgett, both 76, have been Skipton clients for years. “Savings interest is absolute crap,” says Eddie. “The bosses are getting these massive raises, but we don’t see our savings rates going up very much.”

Skipton said the executive directors’ compensation reflects the company’s record performance over the past year with a 129 percent increase in profits.

Why are so few members speaking up?

At the Coventry Building Society’s annual meeting on Thursday, customers raised a number of pertinent questions.

Why were interest rates on tax-friendly ISAS worse than traditional savings accounts – and both lower than Challenger banks? And how much had the company recently spent sponsoring the local league football club’s stadium?

Many questions about inflated wages were tabled by members ahead of the meeting, prompting the Compensation Committee chairman to give a 10-minute presentation in which he defended the bonuses handed out to executives, including chief Steve Hughes, who for the last year received a package totaling £863,000.

Attending a building society meeting used to be a breeze. They had to traipse to the Society’s headquarters or some other venue. But this year, most societies have held hybrid meetings, meaning you can also attend from home using your computer.

As a member of Coventry myself, I watched online and submitted questions using the ‘chat’ feature. Of course it’s no better to be there in person. Not just for the refreshments and entertainment, like the brilliant Camerata Orchestra at Skipton.

Awkward questions can go unanswered online, while executives can’t ignore you when your hand is in the air. Although my questions about board compensation have been answered to some extent, I will attend in person next year. Then I can look executives in the eye as they try to justify their generosity.

Rachel Rickard Straus

THESE ARE THE FIVE BEST MONEY SAVINGS

Advertisement

Large salary packages from Bauspar bosses remain unchallenged

Source link Large salary packages from Bauspar bosses remain unchallenged

Back to top button