The bosses of Britain’s largest listed companies received record pay last year, fuelling the widest earnings gap with workers in eight years – just as the average asking rent on a home in Britain hit a new high.
Median pay for FTSE 100 chief executives climbed to £5.06m in the last financial year, according to data released by the High Pay Centre, an 8.6% increase on £4.66m the previous year and the highest level on record. At the same time, the average advertised private rent in Britain reached £1,397 per month, according to Rightmove.
“FTSE 100 CEOs' median pay hits record £5.06m, 130 times worker salary, as average rent reaches £1,397.”
The pay gap between FTSE 100 bosses and the average full-time UK worker now stands at 130 times, up from 124 times in the previous financial year. It is the biggest gap since the ratio hit 137 in the year to the end of March 2018. The median pay for a full-time UK worker is £39,000, based on estimates from the UK’s Annual Survey of Hours and Earnings.
AstraZeneca’s Pascal Soriot was the FTSE 100’s highest-paid boss last year, receiving £17.7m. Executive remuneration has been rising steadily since the pandemic, when CEOs took pay and bonus cuts as the lockdowns affected business performance.
The High Pay Centre, founded in 2011 by former Guardian business editor Deborah Hargreaves, said FTSE 100 firms had spent £856.6m on pay during the last financial year, including £550m remunerating chief executives. The thinktank is to close after 15 years campaigning for fairer pay for workers.
Its interim director, Andrew Speke, said: “The substantial growth in the gap between executive and worker pay in the last year should be a wake-up call to those who’ve turned a blind eye to rising executive pay. We hope that a change in prime minister and a renewed focus on economic fairness will lead to economic inequality and corporate excess returning up the political agenda.”
Andy Burnham, who will become prime minister on Monday, has previously said there needs to be a public debate about high and excessive pay, and has promised to give “breathing space” as soon as he can to families struggling with the cost of living. Meanwhile, the record rent figure adds to the financial pressure on workers – the median full-time salary of £39,000 would be stretched to cover £16,764 a year in rent alone.
The amount paid out to FTSE 100 executives dropped to £857m from £1bn in the previous report, while mean pay fell from £6.09m to £5.89m. The High Pay Centre said this fall was the result of the exceptionally high pay award of £212m handed out by the engineering firm Melrose Industries the previous year, as executives reaped the rewards after it bought the aerospace and automotive group GKN for £8bn in a hostile takeover in 2018. Sixty-six of the 94 large listed companies in the analysis increased their chief executive’s pay.
