{"id":14960,"date":"2018-04-11T16:00:15","date_gmt":"2018-04-11T15:00:15","guid":{"rendered":"http:\/\/unitelive.org\/?p=14960"},"modified":"2020-11-12T12:59:04","modified_gmt":"2020-11-12T12:59:04","slug":"melrose-chiefs-slammed-earnings","status":"publish","type":"post","link":"https:\/\/unitelive.test.igniteamt.com\/?p=14960","title":{"rendered":"\u00e2\u20ac\u0098Unacceptable face of capitalism\u00e2\u20ac\u2122"},"content":{"rendered":"
<\/div>\n

Melrose executives \u00e2\u20ac\u201c who are on the verge of cashing in after shareholders approved a hostile takeover of GKN last month<\/a> \u00e2\u20ac\u201c earned \u00c2\u0141170m last year, amounting to more than \u00c2\u014140m each.<\/p>\n

 <\/p>\n

Their eye-watering remuneration was slammed by the High Pay Centre as the \u00e2\u20ac\u0098unacceptable face of capitalism\u00e2\u20ac\u2122.<\/p>\n

 <\/p>\n

\u00e2\u20ac\u015bThese are extraordinary sums of money, 10 times higher than the average for a FTSE-100 chief executive, let alone an ordinary worker,\u00e2\u20ac\u0165 High Pay Centre director Luke Hildyard told the Daily Mail<\/a>. \u00e2\u20ac\u015bMelrose are involved in a highly controversial takeover, supported by hedge funds and opposed by workers’ representatives.<\/p>\n

 <\/p>\n

\u00e2\u20ac\u015bTo see a group of executives rewarded so extravagantly, by a committee of other wealthy business leaders and financiers at the same time, makes it very difficult to argue that the UK’s economic model is working functionally or fairly.\u00e2\u20ac\u0165<\/p>\n

 <\/p>\n

According to company accounts filed yesterday (April 10), Melrose chief executive Simon Peckham earned \u00c2\u014142.7m, executive vice chairman David Roper netted\u00c2\u00a0 \u00c2\u014142.3m, finance chief Geoffrey Martin raked in \u00c2\u014142.5m and chairman Christopher Miller took home \u00c2\u014142.3m in 2017.<\/p>\n

 <\/p>\n

Their fat cat pay packets are only the beginning \u00e2\u20ac\u201c under a bonus incentive scheme introduced last year, they could stand to trouser \u00c2\u0141285m in 2022 if they increase the share price of Melrose after the GKN takeover.<\/p>\n

 <\/p>\n

Unsurprised <\/em><\/strong><\/p>\n

Unite assistant general secretary Tony Burke said that \u00e2\u20ac\u015bnothing surprises me about their earnings.\u00e2\u20ac\u0165<\/p>\n

 <\/p>\n

\u00e2\u20ac\u015bMelrose has always been a company that exists solely to make money for its executives and their shareholders \u00e2\u20ac\u201c they are not an engineering firm like GKN is,\u00e2\u20ac\u0165 he noted. \u00e2\u20ac\u015bOur big concern now is how long is Melrose actually going to be in the automotive and aerospace industries. They\u00e2\u20ac\u2122ve said they would commit to staying five years in aerospace but it is our view that the sector requires a lot longer than that \u00e2\u20ac\u201c 15 to 20 years \u00e2\u20ac\u201c to bring in the necessary investment to be successful.\u00e2\u20ac\u0165<\/p>\n

 <\/p>\n

This was a point highlighted this week by University of Sheffield finance and accounting professor Prem Sikka, who noted that \u00e2\u20ac\u015bthe \u00c2\u01418bn paid by Melrose to acquire control of GKN will go straight to the pockets of shareholders. None of it facilitates additional investment in the company.\u00e2\u20ac\u0165<\/p>\n

 <\/p>\n

\u00e2\u20ac\u015bIf Melrose\u00e2\u20ac\u2122s past practices are any guide, GKN will be loaded with debt to enable its new shareholders to extract higher returns,\u00e2\u20ac\u0165 Sikka wrote in the Political Quarterly<\/em><\/a>. \u00e2\u20ac\u015bThe need to service debt will reduce the resources for investment.<\/p>\n

 <\/p>\n

\u00e2\u20ac\u015bSome parts of the GKN will be sold off and jobs will be lost to further reduce the UK\u00e2\u20ac\u2122s pool of skilled labour. Melrose has indicated that it might hang on to GKN for five years, but that is insufficient for long-term planning, research and product innovation in the engineering sector.\u00e2\u20ac\u0165<\/p>\n

 <\/p>\n

While this scenario is a worrying one, Unite believes that it does not have to be a foregone conclusion \u00e2\u20ac\u201c after consulting with GKN reps last week<\/a>, Unite is seeking urgent meetings with both business secretary Greg Clark and defence minister Gavin Williamson to press the case for government intervention on national security grounds.<\/p>\n

 <\/p>\n

Unite is also seeking meetings with Melrose in a bid to secure assurances on investment and jobs if the takeover becomes final on April 19.<\/p>\n

 <\/p>\n

While Unite continues to fight for jobs and an industrial future for Britain, Burke said that ultimately what\u00e2\u20ac\u2122s needed is a \u00e2\u20ac\u015broot and branch review and change of takeover laws.\u00e2\u20ac\u0165<\/p>\n

 <\/p>\n

Notoriously weak <\/em><\/strong><\/p>\n

As it stands in the UK now, takeover laws are notoriously weak<\/a> \u00e2\u20ac\u201c shareholders, many of whom are nothing more than speculators with little interest in the long-term success of the companies whose shares they buy and sell, are given inordinate power.<\/p>\n

 <\/p>\n

Unite is calling for full transparency in any given hostile takeover \u00e2\u20ac\u201c starting with transparency from the Takeover Panel which oversees and regulates takeovers. The union is also lobbying for a two-thirds majority vote for a takeover to be approved by shareholders \u00e2\u20ac\u201c now, the requirement is only a simple majority of 50.1 per cent. Unite has argued that other stakeholders \u00e2\u20ac\u201c such as the workforce \u00e2\u20ac\u201c also must be consulted in any takeover, especially a hostile one.<\/p>\n

 <\/p>\n

\u00e2\u20ac\u015bAbove all there must be laws in place to take into account the national interest, our manufacturing sector and Britain\u00e2\u20ac\u2122s wider industrial strategy,\u00e2\u20ac\u0165 Burke said.<\/p>\n

 <\/p>\n

\u00e2\u20ac\u015bThe situation we have now is that the UK is essentially like a shop \u00e2\u20ac\u201c the doors are wide open, nobody\u00e2\u20ac\u2122s in the shop, and the keys to the safe are hanging up behind the till saying \u00e2\u20ac\u0098take me.\u00e2\u20ac\u2122 We must have stronger legislation to protect our industries and jobs.\u00e2\u20ac\u0165<\/p>\n

 <\/p>\n","protected":false},"excerpt":{"rendered":"

Melrose executives \u00e2\u20ac\u201c who are on the verge of cashing in after shareholders approved a hostile takeover of GKN last month \u00e2\u20ac\u201c earned \u00c2\u0141170m last year, amounting to more than \u00c2\u014140m each.   Their eye-watering remuneration was slammed by the High Pay Centre as the \u00e2\u20ac\u0098unacceptable face of capitalism\u00e2\u20ac\u2122.   \u00e2\u20ac\u015bThese are extraordinary sums of […]<\/p>\n","protected":false},"author":2,"featured_media":14486,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[17],"tags":[624,865,690],"wps_subtitle":"Melrose chiefs slammed for sky high earnings","_links":{"self":[{"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=\/wp\/v2\/posts\/14960"}],"collection":[{"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=14960"}],"version-history":[{"count":2,"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=\/wp\/v2\/posts\/14960\/revisions"}],"predecessor-version":[{"id":26280,"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=\/wp\/v2\/posts\/14960\/revisions\/26280"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=\/wp\/v2\/media\/14486"}],"wp:attachment":[{"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=14960"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=14960"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=14960"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}