Fat cats’ average salary soars to £5m

The average pay of FTSE 100 CEO, or chief executives of British listed blue chips, climbed to 4.964 million pounds (or 7.8 million U.S. dollars) in 2014, approximately 183 times the average full-time British worker, according to a report released Sunday.

The top 10 highest-paid chief executives (CEOs) were paid over £156 million between them in 2014, prompting fresh calls for action to curb executive pay.

High Pay Centre director Deborah Hargreaves pointed out that despite the average wage of CEOs being close to £5 million, only around 25% of FTSE 100 companies pay a so-called “living wage”. The report is based on the mean average pay of FTSE 100 chief executives.

“The Coalition Government introduced some welcome reforms in 2013”.

FTSE 100 bosses earn 183 times more than the average full-time employee, according to the High Pay Centre.

Miss Hargreaves said: ‘One of the defining characteristics of the UK economy over recent decades has been for top executives and other high earners to pull further away while low and middle income workers endure periods of real struggle’.

“However these reforms didn’t do almost enough to start building a pay culture where everyone is rewarded fairly for the work they do”.

Despite changes to regulations in 2013 that force UK companies to publish CEO pay details, the report stated that this had “virtually no effect in curbing excessive executive pay” and that even shareholders have shown “little interest” in holding companies to account for it.

It comes as many workers are still facing modest pay rises as the economy recovers from the 2008 financial crisis. It would also like a structure in which employees are represented in pay negotiations. That ratio is up from 182 times in 2013 and 160 times in 2010, the High Pay Centre says.

Labour leadership contender Jeremy Corbyn said: “These grotesque levels of inequality highlight the fact that our economy is working for the few not the many”.

“Shareholders now have a vote on companies’ pay policies and it is important that this is used effectively”.

Business lobby group, the CBI, said high pay must only ever be justified by “exceptional performance”.

“CEO pay rewards extraordinary talent and skills in a highly competitive, globalised market”, said its deputy director Sam Bowman.