BAE Bosses To Get Multimillion Bonuses?
Bosses at BAE Systems are set to be rewarded with multimillion-pound bonuses, it was reported today, amid fears for the future of its Portsmouth shipyard and the failure of its Eurofighter consortium to land a large contract to supply fighter jets to India.
BAE's top three executives are set to cash in after the group was handed almost £200 million in a tax rebate which will boost its earnings to share - the measure by which annual bonuses and long-term share awards are determined - The Sunday Times said.
The pay package for the year to December for chief executive Ian King, US chief Linda Hudson and finance director Peter Lynas is not yet known but any large bonuses are likely to infuriate the workforce, after the company axed 3,000 jobs across the country.
The decision last September came before it launched a review into its shipbuilding operations which is expected to lead to the closure of its Portsmouth dockyard, where it employs 1,500 staff.
Its closure could potentially land taxpayers with a bill for up to #600 million because within a contract signed in 2009 the Ministry of Defence guaranteed BAE work for the next 15 years and is bound to shoulder the expense of any yard closures.
Meanwhile, the company was recently hit by the news that its Eurofighter consortium is likely to lose its battle with French rival Dassault for a lucrative contract to provide fighter planes to India.
The group, which is one of the UK's biggest manufacturing employers, is expected to report a 10% fall in underlying earnings to £2 billion in 2011 as defence spending in the UK and the US comes under pressure.
Revenues are set to be down by about £2 billion to £20 billion as a result of a reduction to supply orders to the US Army after it pulled out of Iraq and a delay in an order for Eurofighters to Saudi Arabia.
BAE last year signalled the end of production at its factory in Brough, Yorkshire, which employed 1,300 workers, as part of a round of 3,000 redundancies at sites across the UK.
It had already cut more than 15,000 jobs across its global operations over the previous two years in order to boost competitiveness.