Salaries of BT top executives frozen
BT today said it was freezing the pay of its chairman and executive directors this year.
The British telecoms group said its pay committee had decided not to increase the basic salaries of chairman Sir Christopher Bland, chief executive Ben Verwaayen or other executive directors from June 1.
It represents the third year running that the salaries of BT’s chairman or executive directors have remained the same.
However, while basic salaries have remained untouched, some executives saw their total packages rise in 2004 thanks to bonuses.
Mr Verwaayen saw his total salary and benefits package fall by 9.5% to £1.97m (€3m), from £2.17m (€3.3m) last time, in the year to March 31, 2004.
However, it rose to nearly £2.4m (€3.6m) after including deferred bonuses of £429,500 (€645,700) payable in shares in three years’ time.
Although Bland’s basic salary remained unchanged at £500,000 (€751,700), his total package in 2004 rose to £532,000 (€799,800) from £512,000 (€769,700) previously after rises in benefits other than pension.
Another executive director, Pierre Danon, saw his salary and benefits package fall to £750,000 (€1.1m) from £829,000 (€1.25m) last time.
However, it increased to £879,500 (€1.32m) after adding deferred bonuses of £129,500 (€194,700).
BT, which increased pre-tax profits before goodwill and one-off items in the year by 10% to £2bn (€3bn), did not comment in its annual report on reasons for its decision to freeze salaries.
But Bland said in the report that its share price performance this year had not been strong.
Earnings per share before goodwill and exceptionals had risen well, but this was yet to be reflected in the share price, he said.
Bland said the news for shareholders was still positive, highlighting the company’s decision to raise its dividend by 31% to 8.5p (12.8c).
A BT spokesman said: “I think they have taken the current situation of the company into account and found that it was sensible to keep salaries flat while looking at the bonuses and rewarding people on performance.”
BT has been focusing on building up its “new wave” broadband business in the face of a decline in its traditional fixed line activities.
BT said last month that its revenues grew by 0.2% between January and March this year on the back of higher demand for high-speed broadband services.
The roll-out of broadband nationwide is one of the arguments put forward against the potential break-up of BT, which has been placed at the heart of a strategic review of the British telecoms sector by regulator Ofcom.
The separation of BT’s network infrastructure from its retail arm is among five “fundamental questions” to be considered by Ofcom – the new watchdog for the sector – by the autumn.
