The chair of the Post Office’s remuneration committee expressed surprise at the frequency with which the firm’s CEO, Nick Read, enquired about his compensation and bonuses, particularly in light of the significant pressures the organisation faced stemming from the ongoing repercussions of the Horizon IT scandal.
Amanda Burton, who became a non-executive director on the Post Office board last April, was questioned during the public inquiry regarding the testimony related to Read’s alleged “obsession” with his compensation.
“It is indeed accurate to state that he exhibited a keen interest in his compensation,” she remarked.
Under scrutiny from the inquiry’s counsel, she was prompted to clarify whether his emphasis on compensation was characterised as “above average” or “obsessive.”.
“Given the context in which we were functioning, I would categorise it as a matter of significant sensitivity, necessitating a more cautious approach,” she stated. “Nick Read enquired about his compensation and bonus potential to a greater extent than I anticipated.”
In February, it was revealed that Henry Staunton, the previous chair of the Post Office, made two requests to the government for an increase in Read’s compensation to double the current amount.
However, Kevin Hollinrake, a Conservative MP and former Post Office minister, rejected the requests and said that such actions were not necessary given that the Post Office is a publicly owned asset that is under severe financial strain.
The Post Office disclosed this month that Read will resign as CEO in March of the following year, marking five and a half years since his appointment to the position. He had previously taken a temporary leave from his position in July to focus entirely on preparing for his upcoming appearance at the inquiry next month.
Earlier this year, Jane Davies, the former chief people officer at the Post Office, indicated that Read made multiple requests for pay increases, demonstrating a strong focus on remuneration.
The investigation has revealed that the compensation requests directed to the government originated from Staunton, who aimed to secure Read’s position due to the comparatively lower salary levels relative to the broader commercial sector.
During the fiscal year 2022–23, Read received total compensation amounting to £573,000, which encompasses bonuses. In the preceding year, he generated a total income of £816,000, comprising £415,000 in salary and the remainder in bonuses.
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This indicates that he consented to reimburse a £54,000 segment of his bonus associated with the Post Office’s involvement in the official inquiry.
During the fiscal year 2020-21, his compensation amounted to £415,000, with no bonus awarded.
During the inquiry on Friday, Burton was questioned about her perspective on the adequacy of executive compensation at the Post Office.
“The interpretation is contingent upon the perspective from which it is analysed,” she stated. “From the perspective of a postmaster, it appears to be more than adequate.” If one were to operate a charitable organisation, the metrics would indicate a level of adequacy that surpasses expectations. However, the analysis indicates that it appears to be less adequate for operating a public company.