You know when a challenge for the leadership of the Labour Party is becoming credible when the person gets profiled in the Financial Times. Yes Jeremy Corbyn is now heavily tipped to win the election irrespective of the allegations of “dirty tricks” by folks of both extreme left and right persuasion registering just to vote for him. But the really interesting aspect to this writer is that he has adopted a policy that might be very popular with a number of people, even stock market investors. To quote from the FT article he said “I do think the salary levels and the bonus levels again have to be looked at. Some of it is ludicrous and so I am looking at the gap in every organisation between highest and lowest levels of pay.”
Corbyn is of course from the same mould as Ken Livingstone. An advocate of populist left wing policies who has such extreme views (or shall we say, uncommon and uncosted views) on so many matters that he seems to have fallen out with the leadership of the party and most of his colleagues in Parliament many times in the past. In other words a born rebel.
But the pay issue may be a real hook to mount a serious challenge to the Conservatives as many people think it has not just got out of hand, but is massively socially divisive and damaging to economic development. It’s surely not good enough to ignore this issue and simply say company directors should pay themselves whatever they want because institutional investors rarely seem to complain (who are the ones who control the remuneration votes).
The High Pay Centre have just issued a note on a couple of forthcoming meetings on this topic. One points out that the average FTSE100 CEO’s pay went up to £5 million in 2014, from £4.1 million in the previous year. It’s now 183 times the median for full time UK staff.
One of the meetings will have Vince Cable talking about the impact of his reforms on pay regulation – not a lot in essence. Perhaps he may have some ideas on what more should be done because we sorely need them.