NEWS: From the UK

In this issue, executive payrises despite jobs losses and poor performance at Tomkins and Wimpey, BA and other airlines seek tax hand-out to pay for volcano turmoil, Conservative businessmen who cut jobs oppose “jobs tax”, Britain’s shame over Senegal mining industry, and sub-contracting in the cycle courier industry.


Tomkins hands CEO Jim Nicol 58pc pay rise

Tomkins, the British engineering group, has awarded its chief executive a 59pc pay rise despite laying off thousands of workers in the wake of the downturn in the automotive industry.

The FTSE 250 company awarded Jim Nicol a £2.7m pay package after the group climbed back into the black in 2009. Mr Nicol received a £955,000 salary and bonuses and other benefits worth a further £1.73m, according to the group’s annual report.

The payout comes a year after Tomkins risked a pay-for-failure row after awarding Mr Nicol a £500,000 bonus despite falling to a $7.6m (£4.96m) loss in 2008. In 2009 the company improved its financial position but made a pre-tax profit of just $38.4m against a profit of $525.1m in 2007. [READ THE REST]

Airline industry asks for risks to be socialised, but do not suggest they will share the profits out too

British Airways has asked the Government for a bailout after losing nearly £80 million due to Iceland’s volcanic ash cloud that has closed Europe’s airspace. [READ THE REST]

European airlines Tuesday started focusing on their own fate rather than that of their stranded passengers amid signs that securing financial compensation from governments could prove even more complicated than getting their aircraft back in the air. [READ THE REST]

British Airways (BAY.L) has called on the government for compensation for loss of earnings during the closure of European airspace due to a cloud of volcanic ash. TUI Travel (TT.L), which operates Thomson package holidays, also said that it expects to be compensated for losses of tens of millions of pounds. BA chief executive Willie Walsh has criticised the decision to ban flights across Europe. BA said that the grounding of aircraft had cost the company up to 20 million pounds a day since restrictions were imposed last Wednesday. [READ THE REST]

REDFERN’S PAY ALMOST DOUBLES TO 1.7 MILLION POUNDS

Pete Redfern, chief executive of housebuilder Taylor Wimpey (TW.L), saw his pay almost double last year, despite leading the company to a 640 million pound loss. Redfern was awarded a 788,000 pound bonus on top of his 700,000 pound salary, and his pay totalled 1.687 million pounds, up from 874,000 pounds in 2008. The Association of British Insurers has issued an amber top on the company’s remuneration report, while shareholder activist Pirc has advised investors to oppose the pay proposals at an April 29 AGM. [READ THE REST]

The business leaders who support David Cameron on Labour National Insurance plans

THE businessmen sucking up to David Cameron – sorry, taking a principled stand against Labour’s NI rise as a “tax on jobs” – include several whose past tax dodging has enlarged the fiscal hole the NI rise is meant to fill, as well as some fairly recent converts to the cause of job protection.

Sir Chris Gent, for example, led Vodafone when it acquired German phone company Mannesman through a tax avoidance scheme involving Luxembourg. It was intended to dodge billions in tax and is still being contested by HM Revenue & Customs. Now he chairs Glaxosmithkline, which owns several of its most profitable brands offshore to avoid tax.

Paul Walsh employs similar tricks at drinks company Diageo, which last year announced plans to cut 900 jobs by closing its 180-year-old Johnnie Walker plant in Kilmarnock, despite reporting profits of £2bn.

Property boss Jamie Ritblat of Delancey Estates is equally patriotic. He was one of the original backers of Mapeley when it took Britain’s tax offices offshore to avoid tax – a move described by the public accounts committee last week as “highly damaging” (Eyes passim ad nauseam).

The bosses of two companies that send their profits to tax haven-based owners, Matalan chief executive Alistair McGeorge and Virgin group boss Stephen Murphy, were also happy to advise on addressing the country’s fiscal dilemma. Robert Hiscox went one step further not so long ago and re-located his Hiscox Insurance headquarters to Bermuda.

Big job-slashers now worried about the effect of national insurance on jobs include Simon Blagden, chairman of Fujitsu Europe which as well as leaving the taxpayer in the lurch on cocked-up IT contracts (Eyes passim), last year laid off 1,200 of its British employees, most of them former public employees. Steel company Corus’s chief executive, Kirby Adams, also laid off 1,700 workers on Teesside just before Christmas.

Cameron clearly hoped to keep bankers off his list, but one crept in. Until 2008 Bob Wigley was chairman of Merrill Lynch, sub-prime investor par excellence and no small contributor to the economic mess he and his co-signatories are now so exercised by. [READ THE REST]

Senegal’s mining industry

THANKS to British government-sponsored tax avoidance, Britain’s development fund CDC, formerly the Commonwealth Development Corporation, is helping shaft the people of Senegal (annual income: £1,000 per capita) on exploitative mining contracts by siphoning profits to a tax haven.

Since 2004, when it sold its fund management operation, re-branded Actis, to its then chief executive and other bosses for peanuts (Eyes passim), CDC has entrusted British taxpayers’ money to private equity fund managers. Through a number of these, mainly Actis, it has invested £10m in an Australian mining company, Mineral Deposits Ltd, which operates in Senegal on the West African coast. [READ THE REST.]

Sub-contractual

Though classified as self-employed sub-contractors for tax purposes, most bike couriers have in practice a rather more restrictive relationship with the firms that hire them. You may not get a guaranteed income or any benefits, but if you don’t work a full week you’ll generally be out of work pretty quickly. You’re often obliged to wear some sort of uniform or carry a branded bag. The better companies take a deposit for radios and xdas (the palmtop computers on which you receive job details and record signatures) which you get back when you leave, as long as nothing’s been damaged.

Last month one of London’s largest courier companies, CitySprint, informed its riders that they would have to fork out £3 a week to rent some new bags they’d ordered. A disgruntled courier leaked the memo: [READ THE REST]

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