£511m payday for the fat cat housing execs
130 managers given £2.4m bonuses
DOZENS of housing bosses are set to become multimillionaires in one of the biggest paydays in British corporate history.
Under a controversial bonus scheme, housebuilder Persimmon is handing £511million of shares to 133 senior figures.
Three executives, including boss Jeff Fairburn, are in line to receive £194million between them.
A further 130 managers are sharing £317million – an average of more than £2.4million each.
It follows a surge in the company’s share price – thanks in part to subsidies from the taxpayer.
Last night Luke Hildyard, spokesman for the High Pay Centre, said: ‘These pay awards at Persimmon are grossly disproportionate and reward a handful of lucky executives for being in the right place at the right time. It’s a sign of how poorly the company has been governed, by both its board and shareholders.’
The controversial bonus scheme was agreed in 2012 and is paid in shares.
Its first tranche paid out in December but yesterday the second tranche was triggered when Persimmon paid a dividend of 110p to shareholders.
This meant the total paid by the company since 2012 rose to 620p – or a total of £1.9billion – since 2012, the target set by the bonus scheme.
In the latest tranche, Mr Fairburn, 52, will receive £38.5million, in addition to the near £45million payout he took home last year. Finance chief Mike Killoran, 57, is in line to pocket more than £25million, on top of £36.7million last year. Dave Jenkinson, 50, group managing director, is set to receive more than £27million, having had more than £20million in 2017.
The three executives will ultimately receive less overall after fees and taxes, and must hold half of their shares until at least 2021.
Persimmon bosses have always insisted they did not know how much the bonus scheme would end up paying out when it was agreed, because it depended on the company’s share price.
Since 2012, Persimmon’s shares have rocketed more than 370 per cent as Britain’s housing market has recovered.
Nearly 7,700 of the homes Persimmon sold in 2017 were to customers using the Government’s Help to Buy scheme, which lends taxpayer cash to first-time buyers.
The bonus scheme led to Mr Fairburn being nicknamed ‘Mr £131million’ after the potential size of his overall payout was first revealed.
The father of three, who lives with his wife in Durham, later agreed to hand back £25million. Mr Killoran agreed to return £24million.
But the furore led to the resignation of Persimmon’s chairman, Nicholas Wrigley, and the head of its pay committee, Jonathan Davie, in December. Since their departure, Mr Fairburn has also pledged to give a sizeable portion of his bonus to charity – although the Yorkshireman has not said how much that will be.
Yesterday’s payout will also see 130 managers, including those running Persimmon’s 30 regional offices, handed shares worth millions of pounds as well.
Persimmon built about 16,000 homes in the UK last year, which sold for an average of £213,000 each. But, like other housebuilders. the company has been accused by critics of not building quickly enough.
MPs last year branded the bonuses paid to the company’s top executives ‘outrageous’.