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| Version 6 | Version 7 |
|---|---|
| Cameron promises powers to limit executives' pay | Cameron promises powers to limit executives' pay |
| (about 1 hour later) | |
| David Cameron has promised shareholders a binding vote on executive pay, in an effort to deal with excessive salaries. | David Cameron has promised shareholders a binding vote on executive pay, in an effort to deal with excessive salaries. |
| The prime minister told the BBC there had been a "market failure", with some bosses getting huge rises despite firms not improving their performances. | The prime minister told the BBC there had been a "market failure", with some bosses getting huge rises despite firms not improving their performances. |
| He also pledged to tackle large payouts for executives dismissed because of poor performance. | He also pledged to tackle large payouts for executives dismissed because of poor performance. |
| But Labour accused ministers of failing to increase fairness and transparency from boardrooms and the City. | But Labour accused ministers of failing to increase fairness and transparency from boardrooms and the City. |
| >Research from the Institute for Public Policy Research (IPPR) suggests chief executives in 87 of the FTSE 100 companies took home an average of £5.1m in basic pay, bonuses, share incentives and pension contributions in 2010-11. | |
| This represents a year-on-year increase of 33%, while the average increase in company value was 24%, the think tank said. | |
| 'Taking money' | 'Taking money' |
| And an inquiry concluded in November by the High Pay Commission found that the pay of top executives at a number of FTSE companies had risen by more than 4,000% on average in the last 30 years. | And an inquiry concluded in November by the High Pay Commission found that the pay of top executives at a number of FTSE companies had risen by more than 4,000% on average in the last 30 years. |
| Business Secretary Vince Cable is expected to outlined the government's response later this month. | Business Secretary Vince Cable is expected to outlined the government's response later this month. |
| Mr Cameron told BBC One's Andrew Marr Show: "Government can't tell people what they should be paid but [should act] where you've got a market failure... | Mr Cameron told BBC One's Andrew Marr Show: "Government can't tell people what they should be paid but [should act] where you've got a market failure... |
| "Some people are worth £2m [a year] because they've added masses of investment and masses of growth." | "Some people are worth £2m [a year] because they've added masses of investment and masses of growth." |
| But he added that some bosses did not justify their pay and were "taking money from the owners of the companies and from pension-holders and the employees. This is what we will be addressing." | But he added that some bosses did not justify their pay and were "taking money from the owners of the companies and from pension-holders and the employees. This is what we will be addressing." |
| At present, shareholders have a non-binding, or advisory, vote on pay. | At present, shareholders have a non-binding, or advisory, vote on pay. |
| The measures under consideration by the coalition are said to include shareholders getting a veto both on pay packages and on deals given to executives who leave jobs in which they have failed. | The measures under consideration by the coalition are said to include shareholders getting a veto both on pay packages and on deals given to executives who leave jobs in which they have failed. |
| Mr Cameron promised "clear transparency, in terms of the publication of proper pay reports and binding shareholder votes". | Mr Cameron promised "clear transparency, in terms of the publication of proper pay reports and binding shareholder votes". |
| He denied measures would amount to "gimmicks and tokenism", adding that in future "rewards would be linked to success, not failure". | He denied measures would amount to "gimmicks and tokenism", adding that in future "rewards would be linked to success, not failure". |
| The prime minister hinted that legislation could be announced in the Queen's Speech, which is likely to take place in the spring. | The prime minister hinted that legislation could be announced in the Queen's Speech, which is likely to take place in the spring. |
| Labour has called for policies on pay and a "more responsible" capitalism. | Labour has called for policies on pay and a "more responsible" capitalism. |
| 'Complex' | 'Complex' |
| Shadow business secretary Chuka Umunna said the prime minister was "failing to meet the three tests of greater accountability, transparency and fairness which Labour has set to end the 'something-for-nothing' culture in our boardrooms and the City". | Shadow business secretary Chuka Umunna said the prime minister was "failing to meet the three tests of greater accountability, transparency and fairness which Labour has set to end the 'something-for-nothing' culture in our boardrooms and the City". |
| He added: "There is no point giving shareholders a vote on executive pay without the greater transparency needed so they can discern the aggregate remuneration executives receive under the complex arrangements currently in place." | He added: "There is no point giving shareholders a vote on executive pay without the greater transparency needed so they can discern the aggregate remuneration executives receive under the complex arrangements currently in place." |
| Kevin Green, of the Recruitment and Employment Confederation, said there were concerns about how some suggestions to curb executive pay would play out. | Kevin Green, of the Recruitment and Employment Confederation, said there were concerns about how some suggestions to curb executive pay would play out. |
| "The idea of a binding vote from shareholders. Do we have to get all of the shareholders together at an AGM and have a vote? | "The idea of a binding vote from shareholders. Do we have to get all of the shareholders together at an AGM and have a vote? |
| "While we recognise there is a perception issue, what we're really keen to see is that there are some workable, sensible solutions from government." | "While we recognise there is a perception issue, what we're really keen to see is that there are some workable, sensible solutions from government." |
| Meanwhile, French finance minister Francois Baroin has suggested that an EU-wide tax on financial transactions, including share sales and currency deals, should go ahead. | |
| 'Growth agenda' | |
| But Mr Cameron, who fears this would damage the City, said he would veto the proposal, saying: "If the French themselves want to go ahead with a transactions tax in their own country then they should be free to do so. | |
| "We actually have stamp duty on share transactions in Britain and yet we have one of the most competitive and successful financial services markets anywhere. | |
| "But the idea of a new European tax when you are not going to have that tax put in place in other places I don't think is sensible, and so I will block it unless the rest of the world all agreed at the same time that we were all going to have some sort of tax." | |
| The prime minister also promised to work during the year to reduce unemployment, saying the whole government was working to "a growth agenda" for the economy. | |
| And he urged the Scottish National Party government in Edinburgh to hold its proposed referendum on whether to leave the UK "sooner rather than later". | |
| First Minister Alex Salmond has said such a vote will only take place in the second half of the five-year parliamentary term, which began last year. |