LONDON’S BUSINESS NEWSPAPER
RORY FOR OPEN GLORY? MCILROY AMONG FAVOURITES AT ROYAL LIVERPOOL P19 WEDNESDAY 19 JULY 2023
ISSUE 4,015
SOBER CURIOUS RUSSELL BRAND’S ‘LIFE-CHANGING’ FESTIVAL P16
CITYAM.COM
IT’S BONUS TIME AT THE BANK £25M PAID OUT TO THREADNEEDLE STREET STAFF DESPITE BAILEY’S PAY RESTRAINT CALL
JACK BARNETT THE BANK of England has dished out tens of millions of pounds in bonuses despite governor Andrew Bailey and other senior officials demanding workers accept realterms pay cuts. Threadneedle Street rewarded staff with a total of £25m in one-off handouts over the last year, up from £23m in the previous year, according to a freedom of information request filed by openDemocracy. Last year’s bonus bump comes after Bailey last month branded the current
pace of wage growth as “unsustainable”, saying it must cool down to curb inflation. Wage increases have been outstripped by inflation for more than a year and a half, meaning workers have undergone a prolonged fall in their living standards. Huw Pill, the Bank’s chief economist, also drew sharp criticism earlier this year when he said workers “need to accept” they are poorer as a result of increasing prices. New figures out this morning from the Office for National Statistics (ONS) are expected to show the cost of living crisis is still gripping family finances.
The stats agency is tipped to estimate inflation fell to 8.2 per cent in June from 8.7 per cent May, but core and services inflation are likely to remain broadly unchanged at around seven per cent. Average pay at the Bank is £62,189, while Bailey is on about £500,000 a year. Bailey passed up a pay rise last year. Average household income after taxes and benefits in the UK is £38,100. A Bank of England spokesperson said: “For this year, the Bank has given a 3.5 per cent pay award to its staff” which is below the UK average of 7.3 per cent, according to the latest ONS numbers.
Bonuses were calculated as the same share of pay as last year, the Bank said, suggesting the £2m pool expansion was down to an increase in staff. Stepping up performance-based rewards is likely to attract scrutiny due to the Bank’s poor track record in taming inflation. The last time the central bank reached its two per cent inflation target was July 2021. Inflation peaked at 11.1 per cent in October 2022. “There is no question of the Bank unduly rewarding its staff,” the spokesperson added.
FREE TECH DARLING
Darktrace in the clear on figures: EY JESS JONES SHARES in Darktrace closed up 28 per cent yesterday after it revealed that a review of its accounts found a “number of areas” for improvement but were not “material” to its financial reporting. The London-listed cybersecurity company hired EY in February to review its books after a short seller questioned its accounts. New York-based hedge fund Quintessential Capital Management took a short position on the firm’s shares after it said “sales, margins, and growth rates may be overstated” and the company’s accounts contained “serious accounting red flags”. But EY’s report seems to have eased investor concerns. Darktrace’s chairman Gordon Hurst said the review “further reinforced the board’s confidence that management has set a tone and culture consistent with good governance”. Danni Hewson, head of financial analysis at AJ Bell, said the findings “essentially proved that the cybersecurity expert doesn’t have any skeletons in the closet.” CEO Gustafsson hopes to move on
Oxford Street set for small shop revolution as council wages war on candy stores LAURA MCGUIRE OXFORD Street is set for a major revamp as Westminster City Council launches a new £10m scheme to transform London’s iconic high street. The council will make shops vacated by illicit candy stores –
which have blighted the leading retail destination – available to small business owners rent free, and lower their business rates by 70 per cent. For now, the scheme will offer nine units to businesses looking to launch their first store, with the first small firms expected to set up shop in August. The London Chamber of
Commerce and Industry (LCCI) said the programme would help increase footfall and provide tourists from across the UK and around the world with the “ultimate London shopping experience they are looking for”. “We strongly back this great initiative by Westminster City Council to ensure that the capital’s
premier shopping thoroughfare continues to flourish with innovative and forward-looking brands,” James Watkins, head of policy at LCCI, told City A.M. "During this cost of living crisis, it is critical that there are initiatives to help small businesses not just survive but thrive," Martin McTague,
head of the Federation of Small Businesses, told City A.M. “New brands will reinvigorate the West End… getting a chance to establish themselves in a space that would ordinarily be far outside their budget,” he said, adding it was a “great initiative” and that the model could be applied more widely.
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