Vir Cantium

I'm right, you know …

Reasons To Be Cheerful … Or Miserable?

There is a tone that newsreaders adopt when announcing, for example, that crime has risen or that a company has closed with hundreds of job losses, or the death of some obscure lefty writer that virtually no-one beyond Broadcasting House or Farringdon Road has ever heard of.

I heard this tone this morning, when the BBC’s Today programme told us that bonuses in the largest companies have risen back to the levels that they were before the credit crunch:

FTSE 100 executive bonuses close to pre-crisis levels

Executive bonuses are close to their level before the financial crisis, a survey by business advisory firm Deloitte says.

It found that the average bonuses for directors of FTSE 100 firms amounted to 100% of their basic salary, rising to 140% in the top 30 public companies.

Yet surely this is excellent news? Generally speaking, if bonuses are up then that might be a sign that we’re turning the corner, economically speaking. (The accompanying point that general executive pay is not rising particularly fast suggests that directors are also exercising some healthy and measured caution.) It’s certainly good news for the Treasury, as these bonuses will be taxed at up to 70% – a much higher rate than if they have been taxed at, say, the main corporation tax rate.

So why the glum faces everyone?

P.S. No, I haven’t got time to check out the bonus levels of, say, BBC executives and how they compare to 2007….

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