Royal Mail hits back and misfires

Royal Mail has won some plaudits for hitting back at Labour leader Jeremy Corbyn’s video attacking the company for paying a further £68 million to its private shareholders at the same time as it has been raising prices, cutting services and trying to reduce staff pension contributions.

The Guido Fawkes blog said: “Something great happened yesterday: unlike many firms under political attack, Royal Mail didn’t shy away with a boring press release to the FT, they hit back with facts on social media”.

Among the “truth bullets” Royal Mail had tweeted out which drew Guido’s approval was this one:

“Royal Mail is one of very few companies to pay more in pension contributions than dividends.”

Except that the company is in a long-running dispute with the unions precisely because it is trying to reduce those pension contributions.

Of course, one place to start might be to look at its chief executive, Moya Greene, who gets the equivalent of almost 37% of her £547,800 base salary in pension contributions (£200,000) according to the last annual report. By any standard, that is very generous indeed.

For newly appointed executive directors the pension contribution has been cut to 17.5% of their salary but there will be no change to Greene’s.

Add in the £440,000 cash bonus, another £440,000 into a deferred share bonus plan, £209,000 into a long term incentive plan and £43,000 in benefits (up by £12,000 on the year before) including financial advice, a chauffeur for business-related travel plus two return flights to Canada a year, and Greene’s total remuneration in the year 2016-17 was £1,880,000 up by 23% on the previous year.

By comparison the average salary of a Royal Mail employee was £28,919, with benefits and cash bonus added that rose to £29,820, down by 0.46% on the previous year.

Greene is a long way from being among the highest paid CEOs in the FTSE 100 where average remuneration in 2016 was £4.5m according to a report by the CIPD and High Pay Centre in August. But it illustrates the danger of going into battle on territory where you are vulnerable.

A “fat cat” arguing that everybody’s pensions apart from her own need to be cut to maintain the profitability of a privatised utility is merely an open goal for those arguing it should be renationalised.

Photo credit: Ross Holdway