Trade and industry minister Lord Sainsbury spoke out during a questions session in the House of Lords after insisting that the government wait to see how far directors’ remuneration report regulations, introduced a year ago, succeed in curbing excessive pay awards to directors.
The issue was raised by Labour peer Lord Dormand of Easington, who is pursuing a campaign to persuade the government to legislate against ‘huge payments’ when companies are losing money. Tory peer Baroness Miller of Hendon said that if the government does this, they must also control the pay of trade union leaders.
Lord Davies of Coity protested, saying: ‘Is it not obscene for the chairman and executives to protect themselves with regard to their pension arrangements, when at the same time they are destroying the pension arrangements of their employees?’
Sainsbury said: ‘I share the view that it is very inappropriate for company directors to be making large pension provisions for themselves at a time when they are closing down pension schemes for their employees.’
He said the regulations had ensured greater transparency on directors’ remuneration and action had been taken to protect members of company schemes.
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