In Defence of Marxism

According to KPMG, an accountancy firm, the typical CEO of an FTSE 100 company has seen his total income rise by 12 per cent in the past year, and reach the average figure of more than £2.6million. That's four times the rate of increase in average earnings, leaving the business elite on pay over100 times what most of their employees earn.

Britain's top corporate earner is said to be Bob Diamond of Barclays Capital, who took home £22.9million in 2006, including a performance-related bonus of £10.4million. Others include Bart Becht, CEO of Reckitt Benckiser, on £22million; Giles Thorley, head of Punch Taverns, making ends meet on £11m; and Lord Browne, late of BP, was similarly well looked after. Mr Thorley's package is equivalent to 1,147 of his staff's pay. Taken together, the directors of FTSE 100 companies collectively earned £515million in 2006 - exceeding the GDP of countries like Eritrea and the Seychelles!

As these figures pre-date the credit crunch, we are informed that recent developments may have a moderately depressing effect on top people's pay, especially for those in the City. Such falls in income may drastically affect the productivity of these key workers so Mary Carter, a partner at KPMG, explained that,

"incentives need to be clear and concise signals. Targets are often set to pander to investors' understanding at the expense of effectiveness. Will 2008 be the year in which more companies put their heads above the parapet and implement bold remuneration strategies that really encourage stellar performance?"

A job well done deserves being paid well. And as these people are doing such a good job in protecting our bank accounts and mortgages, we are sure the rest of us won't begrudge them getting the appropriate incentive for defending our interests so well!