High Pay Commission sets out plan to tackle pay inequalities

22 Nov

The High-Pay Commission has set out a 12-point plan to help tackle the inequalities in pay, and the damage that high pay causes to companies, the economy and society.

Its report Cheques With Balances: why tackling high pay is in the national interest is the result of an independent inquiry into why pay at the top has increased, and pay differentials have grown, over the past 30 years. It found that “stratospheric pay increases” had seen wealth flow towards the top 0.1% of earners and away from the average worker, creating a pay gap between rich and poor “that rivals that in some developing nations”.

Deborah Hargreaves, chair of the High Pay Commission, said: “The public is rapidly running out of patience with a system that allows those at the top to enrich themselves while everyone else struggles to make ends meet.”

The Commission’s 12-point plan includes simplifying executive pay, publishing the top 10 executive pay packages outside the boardroom, forcing companies to publish a pay ration between the highest paid executive and the company median, and establishing a new national body to monitor pay.

Ms Hargreaves added: “There’s a crisis at the top of British business and it is deeply corrosive to our economy. When pay for senior executives is set behind closed doors, does not reflect company success and is fuelling massive inequality, it represents a deep malaise at the very top of our society.

“The British people believe in fairness and, at a time of unparalleled austerity, one tiny section of society – the top 0.1% -continues to enjoy huge annual increases in pay awards. Everyone recognises there is a need to tackle top pay. That’s why we are saying there must be an end to the ‘closed shop’ that sets top pay and that pay packages should be clear, open and published to shareholders and the public.”

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