BT boss Gavin Patterson’s pay rocketed to £2.3million – even as his company lays off 13,000 staff to repair battered finances.
The amount the 50-year-old took home leapt 72 per cent in the last financial year, including an annual bonus of £1.3million and pension contributions of nearly £300,000.
The chief executive would have been handed even more again but took a £338,000 pay cut over BT’s accounting scandal in Italy, the company’s annual report revealed yesterday.
It comes despite the telecoms giant going through what is widely seen as a torrid year, with its share price languishing at lows not seen since 2012.
The amount the 50-year-old BT boss Gavin Patterson took home leapt 72% in the last financial year, including an annual bonus of £1.3m and pension contributions of nearly £300,000
Just two weeks ago it issued a profit warning and Patterson said that thousands of administration and management jobs needed to be axed.
‘Decisions like this are not easy, we recognise it is going to affect a lot of people,’ he said at the time.
Yesterday, a BT spokesman admitted the company had a ‘challenging year’ but insisted it had made good progress.
‘Gavin’s total remuneration for the year was £2.3million, as a result of targets being met for customer service improvement and cash flow’, he added.
‘Given the underlying financial and operating performance of the business during the year, the remuneration committee agreed Gavin’s proposal that his bonus be capped at target.’
But Luke Hildyard, director of the High Pay Centre, said: ‘It’s arrogant and insulting for Gavin Patterson to be taking home a huge pay increase while thousands of his workers are losing their jobs, and for the board to piously make out that a small reduction to his bonus is some kind of noble sacrifice.
‘When will directors start to take some responsibility for crumbling trust in business?
‘Probably not for a long time in BT’s case, seeing as the entire pay committee is made up of other big business executives who benefit from the same depraved pay culture.’
In the past year BT has been left reeling by a £500million Italian accounting scandal, grappled with a yawning pension scheme black hole, battled regulators over pricing and faced criticism for not investing more in its broadband network.
In a report on customer satisfaction by Ofcom this month, it was the most-complained about company per 100,000 people of any internet provider and had the second-worst levels of customer satisfaction.
The turmoil has triggered intense speculation about Patterson’s future, despite company insiders saying he still has the backing of chairman Jan du Plessis.
Patterson took the job five years ago and has poured about £5billion into sports rights, to attract customers to its pay TV service.
However, despite shares reaching highs of nearly 500p in 2015, they have more than halved to just over 200p since.
Analysts say Patterson’s job is likely to be on the line if he cannot turn fortunes around soon.
This year he has bought himself some breathing room, striking a deal with unions to start reining in the pensions deficit and announcing fresh investment in broadband, a move welcomed by regulator Ofcom.
And in an announcement on May 10, the chief executive said that he would slash costs by £1.5billion, move out of the company’s central London base to cheaper premises and modernise the business.
But he also warned sales were expected to fall again in the coming year and said there would be no profit growth for two years.
BT shares have fallen more than 13 per cent since then. In the past 12 months, the company’s share price has tumbled 35 per cent.
Yesterday they dipped another 1.5 per cent, or 3.15p, to 203.15p.