Tomorrow's Business Today
Rishi gets real, not, on executive pay
Here is CBI director-general Tony Danker to Rishi Sunak after his speech to the business lobby.
“You should be a CEO! You’re wasted in this job!”
Let’s skip past that Danker thinks running one company is a more worthy job than running the whole country. It might just be a joke.
But what it says is that he is one of them, and they are with him.
That’s not necessarily a bad thing, but it has clear implications. For a start that he is unlikely to demand a change in CEO behaviour anywhere down the line, since that would be an implied criticism of himself.
At the G20 summit, Sunak reportedly told bosses “to curb their pay and look after their staff”.
“I would say to executives to embrace pay restraint at a time like this,” said Sunak.
Is he actually going to do anything to enforce that, or is it just a PR line for a speech?
The latter looks most likely. The rest of the speech has it that he is sure, just certain, that CEOs and their boards will do the right thing. Honourable men (and a few women) as they are.
There has been a clampdown on executive pay supposedly coming for as long as I’ve been following it. What actually happened was that CEO pay spiralled in spectacular fashion.
To do something about it would require radical intervention in a market that Sunak and co regard as “free”.
A letter in the FT today did have a proposal for how to do it “if the prime minister is serious about this”.
For a start, when the top dogs earn 20 times more than the lowest paid in the company, a tax is imposed equal to the excess amount.
But the company gets a tax break if bonuses are distributed equitably among staff, not gobbled by the directors.
That might work. The chances of Rishi Sunak introducing such a law are as near zero as makes no difference.
Press release of the day
The Treasury got £4.1 billion in inheritance tax between April and October, £500 million more than a year ago.
The figures are going up even though IT threshold’s have been frozen until April 2028, says this from Wealth Club.
Alex Davies says: “This is another stealth tax and the case of the boiling frog is apt.”
Stories that will keep rolling
1) Can De La Rue fend off angry investor Crystal Amber?
2) How is Jeremy Hunt doing before the Treasury Committee?
3) How do our PMIs compare to Germany’s?
4) Have people cut back on dog treats from Pets at Home?