‘Aghast at the greed’

Privatised Royal Mail is facing furore over its new chairman, after he approved “obscene” and “disgraceful” pay packets for top executives.

Les Owen has been appointed chairman despite being on the pay committee that authorised a “golden handshake” worth nearly £6m for new CEO Rico Back.

The committee also handed former chief executive Moya Green, who oversaw Royal Mail’s privatisation in 2013, around £2.7m as part of her departure deal.

Unite has described the pay outs, which led to a 70 per cent shareholder revolt in July – one of the biggest in British corporate history – as obscene.

Despite the controversy, Owen was this week promoted to chairman following the resignation of Peter Long.

Owen’s appointment was handled by Royal Mail senior independent director Orna Ni-Chionna, who also sits on the pay committee.

His appointment sparked fury amongst shareholders, with Cliff Weight from the Sharesoc shareholder group saying, “shareholders would welcome a fresh perspective from a chairman who was not involved in setting the disgraceful remuneration”.

Failures of privatisation

Unite national officer for services Rhys McCarthy said the pay deals, which are being looked at by MPs, are another reminder of the failures of privatisation.

He said, “The money being creamed off Royal Mail by its executives is obscene, especially when you consider that Rico Back already worked for the company – in effect he’s been paid a £6m bonus for an internal promotion. It says something when even Royal Mail shareholders are aghast at the greedy excesses of the firm’s leadership.

“Unfortunately this is what you get when publicly owned services are sold off to private companies.

“The focus changes from providing decent delivery to extracting cash, with the public and workforce usually suffering the consequences to service provision and employment standards.”

He added, “This episode of flagrant money-grubbing at the Royal Mail should serve as yet another reminder of why mail, rail, utilities and other essential services are far better off in public hands.”