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Whatmuff

Persimmon Boss 75 million bonus

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https://www.google.co.uk/amp/s/amp.theguardian.com/business/2018/jan/09/persimmon-profits-chief-bonus-scheme

Now I'm not one for criticising people that work hard and earn a living through honesty and fair play, but this guy and many of the Shareholders have taken bonuses that have reached record levels. I mean 75 million pounds.... It's insanity! 

The profits from this house building companies have pretty much been funded directly from the tax payer and here's how. The house building company builds new "substandard" homes and then sells them at full market rate. The Government's help to buy scheme allows people to buy new homes with a 20% loan or a 40% loan in London. All these loans have done is increase the average house price, by allowing people to purchase more expensive homes. Plus most of the people using them didn't need the extra loan, it just allowed them to buy a bigger place! That's tax payers money that goes directly to these home building companies, not back to the government, not back to the banks and back to pay the debt. On top of that the mortgages that are being lent to these first time buyers is from Quantitative Easing (printed money) from the Bank Of England lent at base rate and then lent through highstreet banks. Once these mortgages are set up the high street banks group them up and then sell them on to investors or funds.

These house builders knew after the 2008 crash with interest rates being reduced to near zero, 4 lots of QE and a scheme introduced by the Chancellor to give people money of significant proportions to buy new homes that they would be able to make millions. It's corruption of the highest order, and the company has just made millions by using Government Subsidies. The Share price of the company rocketed when the Help to Buy scheme came in.

Just 4% of his bonus would buy homes for the 58 homeless families in York.

How are we struggling with finance for the NHS, knife crime, teachers, military, Fire Service, Police and here we have tax payers money paying for one of the biggest bonus ever , not to mention the millions being paid out to the rest of the team. 

 

No one can honestly justify this, can they?

Edited by Whatmuff

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It was all written in to his contract when things were not so good in the building trade.

No body bothered to add a cap in case of an upturn in the trade.

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PERSIMMON, not Permission.

He was interviewed on our local news programme and all was going well until the reporter asked him about this bonus. It all went downhill from there and couldn’t come up with an answer so just walked away from the interview. I love to see people like this squirm.

Totally legal, but a bit awkward when asked about it. 😀

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1 minute ago, TIGHTCHOKE said:

It was all written in to his contract when things were not so good in the building trade.

No body bothered to add a cap in case of an upturn in the trade.

I kind of get that but surely anyone with a bit of financial sense or inside info would have guessed that there was still room to move with interest rates, and with a housing shortage there was lots of money to still be earned? His financial director is to receive 86 million or was. 

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2 minutes ago, Scully said:

PERSIMMON, not Permission.

He was interviewed on our local news programme and all was going well until the reporter asked him about this bonus. It all went downhill from there and couldn’t come up with an answer so just walked away from the interview. I love to see people like this squirm.

Totally legal, but a bit awkward when asked about it. 😀

😂 I thought I corrected it before it went live Scully. My predictive text is playing silly *******. Yup he squirmed alright, I watched it. If I ran a company like that and those sort of profits were declared if like to think those earnings would be distributed further down.

Just now, DanBettin said:

Would you not take the bonus if you were him?

75 million? I would and I'd make change with it. I suppose I have different way of thinking to this chap. This is greed, and it's effectively tax payers money.

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8 minutes ago, Whatmuff said:

75 million? I would and I'd make change with it. I suppose I have different way of thinking to this chap. This is greed, and it's effectively tax payers money.

How do you know he won't make change with it? Are you judging the fact he was legally entitled to it or judging what he should and shouldn't do with it?

 

EDIT: Also, what constitutes greed? That is subjective. We may play the game and not evade tax, for example, but most of us will avoid it (to different degrees). I'm not sure playing the game by taking what is legally his is any different. Are we all greedy? If so, how can we judge him? What would you rather he did?

Edited by DanBettin

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8 minutes ago, DanBettin said:

How do you know he won't make change with it? Are you judging the fact he was legally entitled to it or judging what he should and shouldn't do with it?

 

EDIT: Also, what constitutes greed? That is subjective. We may play the game and not evade tax, for example, but most of us will avoid it (to different degrees). I'm not sure playing the game by taking what is legally his is any different. Are we all greedy? If so, how can we judge him? What would you rather he did?

It's not just me that thinks it's greedy, it's Charities, Politicians, and Corporate Governance Experts. It's because the profits are directly related to Government Subsidiaries that's my point. If you can't tell me taking that amount of money in today's society constitutes greed then I don't know the meaning of greed. Just looking at the average human and average wage for me know of puts it in perspective. He earned 200k a day....... He can buy a house a day..... That for some people is a 35yr mortgage and a lifetime of working. That is greed in my book. And especially when new build properties are built on the cheap and substandard. The market will fail, and this guy has just got all his earnings out before it does. 

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20 minutes ago, DanBettin said:

Are you judging the fact he was legally entitled to it or judging what he should and shouldn't do with it?

I wouldn't pass judgement on him personally - but I would suggest that a system which gives rise to bonuses of this magnitude is economically flawed. It's an inefficient use of money.

Edited by Retsdon

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2 minutes ago, Whatmuff said:

It's not just me that thinks it's greedy, it's Charities, Politicians, and Corporate Governance Experts. It's because the profits are directly related to Government Subsidiaries that's my point. If you can't tell me taking that amount of money in today's society constitutes greed then I don't know the meaning of greed. Just looking at the average human and average wage for me know of puts it in perspective. He earned 200k a day....... He can buy a house a day..... That for some people is a 35yr mortgage and a lifetime of working. That is greed in my book. And especially when new build properties are built on the cheap and substandard. The market will fail, and this guy has just got all his earnings out before it does. 

I know your intentions are good, but I think it's just a knee-jerk reaction to the sheer size of the pay out that has you comparing it to what else it could be used for. It s a noble perspective, but I don't think it's your right to call it greed or not. You didn't really answer any of my questions. The point I'm trying to get at is we'd probably all do the same in his position. So don't hate the player, hate the game. Don't call it greed, unless you're the anomaly that opts to pay out far beyond what you would otherwise be taxed, and opt to always spend your money on other better uses of it.

 

Just now, Retsdon said:

I wouldn't pass judgement on him personally - but I would suggest that a system which gives rise bonuses of this magnitude is economically flawed. It's a crappy use of money.

I don't disagree, actually. I think when the finger stops pointing at the system and starts pointing at the individual, though, I have a problem with that.

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5 minutes ago, DanBettin said:

I know your intentions are good, but I think it's just a knee-jerk reaction to the sheer size of the pay out that has you comparing it to what else it could be used for. It s a noble perspective, but I don't think it's your right to call it greed or not. You didn't really answer any of my questions. The point I'm trying to get at is we'd probably all do the same in his position. So don't hate the player, hate the game. Don't call it greed, unless you're the anomaly that opts to pay out far beyond what you would otherwise be taxed, and opt to always spend your money on other better uses of it.

 

I don't disagree, actually. I think when the finger stops pointing at the system and starts pointing at the individual, though, I have a problem with that.

Well in the article and his behaviour in the interview "he's feels he's earned it" and he's worked hard! Hard..... For real? So managing some money, buying a piece of land, paying some architects to design housing estates, getting a team of builders to build some homes, and then paying a sales team to sell them, is working hard? I think he's so far detached from reality and that's the reason I have an issue with him recieving that amount of tax payers cash. My mother is a nurse and has been for over 35 years, she's saved countless lives over the years, both old and young, worked 18 hour days to put food on our table and this guy has earned more than her entire career in a week. 

A good friend of mine is a fireman, who regularly pulls charred bodies out of burnt homes including kids, gets to see families in road accidents daily, has to put his life on the line for 35 grand a YEAR. 

And I just spent two years of my life in a cockpit overseas on Operations dropping weapons within meters of friendly forces, overhead people that would thrive on skinning me slices or taking my head off. 

I have so many examples of people in today's society working "hard" and under stress that have had their pensions halved and benefits freezed and pay checks cut in order to help bring down the national debt and attempt to help restore the economy. And here we have a guy that's worked hard in 5 years and feels it is his right to take 75 million as a bonus for doing a good job, and then taking 10 grand for the company to cover his legal costs? He sounds like a nice chap that probably doesn't rely on the NHS, or the Police or the amazing teachers in public schools providing equipment for students out of their own pockets. 

People would just like pay rises inline with inflation to help pay the bills, and we get told there is no more money, we have to live within our means and then this guy who is profiting directly from Government Money is taking home 75 million? Still seem fair?

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23 minutes ago, Whatmuff said:

Well in the article and his behaviour in the interview "he's feels he's earned it" and he's worked hard! Hard..... For real? So managing some money, buying a piece of land, paying some architects to design housing estates, getting a team of builders to build some homes, and then paying a sales team to sell them, is working hard? I think he's so far detached from reality and that's the reason I have an issue with him recieving that amount of tax payers cash. My mother is a nurse and has been for over 35 years, she's saved countless lives over the years, both old and young, worked 18 hour days to put food on our table and this guy has earned more than her entire career in a week. 

A good friend of mine is a fireman, who regularly pulls charred bodies out of burnt homes including kids, gets to see families in road accidents daily, has to put his life on the line for 35 grand a YEAR. 

And I just spent two years of my life in a cockpit overseas on Operations dropping weapons within meters of friendly forces, overhead people that would thrive on skinning me slices or taking my head off. 

I have so many examples of people in today's society working "hard" and under stress that have had their pensions halved and benefits freezed and pay checks cut in order to help bring down the national debt and attempt to help restore the economy. And here we have a guy that's worked hard in 5 years and feels it is his right to take 75 million as a bonus for doing a good job, and then taking 10 grand for the company to cover his legal costs? He sounds like a nice chap that probably doesn't rely on the NHS, or the Police or the amazing teachers in public schools providing equipment for students out of their own pockets. 

People would just like pay rises inline with inflation to help pay the bills, and we get told there is no more money, we have to live within our means and then this guy who is profiting directly from Government Money is taking home 75 million? Still seem fair?

I think you're being too emotional and taking it too personally to be able to rationally debate this, not sure there's much merit in me replying properly. You've missed my point a few times.

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If it was me i would have quite simply said thank you very much, thats what my contract says, thats what i am entitled to, its not my fault if your highly paid solicitors cant put a simple clause in a contract.

If you were lucky enough to be in his position would you really out the goodness of your heart say to Persimmon homes you keep?? you can guarantee they wont be pumping it back into the housing market for the good of the nation.

 

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10 minutes ago, DanBettin said:

I think you're being too emotional and taking it too personally to be able to rationally debate this, not sure there's much merit in me replying properly. You've missed my point a few times.

Apologies, perhaps I am. I'm stuck in a hospital ward for 5 days with my 4 week old and I'm surrounded by incredible nurses working around the clock. I can't help get emotional about something like this. I just wish he'd avoided the cameras and news. 

Maybe would have been better if the Government taxed the help to buy profits and took those back in taxes.

Hey I guess it's the world we live in now.

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10 minutes ago, Whatmuff said:

Apologies, perhaps I am. I'm stuck in a hospital ward for 5 days with my 4 week old and I'm surrounded by incredible nurses working around the clock. I can't help get emotional about something like this. I just wish he'd avoided the cameras and news. 

Maybe would have been better if the Government taxed the help to buy profits and took those back in taxes.

Hey I guess it's the world we live in now.

Don't be apologising, as I've already said I think your perspective on it is the most noble. The thing is, I don't disagree with you with regard to the fact he is entitled to it being all wrong. But I think the subtlety of where we place the 'blame' (or criticism, at least) matters. It's not his fault, I would hope he did something great with that amount of money, I certainly would. I don't know how you could take that money and not do something kind with it. But if I was him I would definitely take it, and I'm not sure I'd call that greed. That's the only point I was making. I do not think this situation is right, likewise I don't think it's personal.

 

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It is obscene but at the end of the day its business. There are plenty of investment bankers etc making similar ridiculous  amounts of money. And its all relative- these people only compare themselves against their peers in the CEO bracket, not the average worker. At the end of the day that renumeration was in his contract so why shouldnt he take it? I believe he was actually entitled to 100 million but waived 25 of it. Put it this way- if as you intimate you are raf pilot/aircrew youll be on in the region of 50k+. What would your reaction be if people said you should refuse half of it and take only the national average of about 25k because you can live perfectly well on that..? 

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I think there are a few issues at play.  I agree that the help to buy scheme ended up being abused by the house builders, although I think the sentiment behind the scheme was sound, it was so poorly put into place it provided taxpayer subsidised profits for developers and that was not the intention.  Profit is a good thing and not a dirty word, but when those profits that were directly achieved as a result of government subsidy results in exorbitant payouts to directors then it does become a problem for me.

The size of the bonus in itself is extreme, but I accept that is what was written into his contract and if it was a bonus offered to me i would not be saying no because it might offend some other people.

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11 minutes ago, grrclark said:

I think there are a few issues at play.  I agree that the help to buy scheme ended up being abused by the house builders, although I think the sentiment behind the scheme was sound, it was so poorly put into place it provided taxpayer subsidised profits for developers and that was not the intention.  Profit is a good thing and not a dirty word, but when those profits that were directly achieved as a result of government subsidy results in exorbitant payouts to directors then it does become a problem for me.

The size of the bonus in itself is extreme, but I accept that is what was written into his contract and if it was a bonus offered to me i would not be saying no because it might offend some other people.

Perfect. 

19 minutes ago, miroku mk70 said:

It is obscene but at the end of the day its business. There are plenty of investment bankers etc making similar ridiculous  amounts of money. And its all relative- these people only compare themselves against their peers in the CEO bracket, not the average worker. At the end of the day that renumeration was in his contract so why shouldnt he take it? I believe he was actually entitled to 100 million but waived 25 of it. Put it this way- if as you intimate you are raf pilot/aircrew youll be on in the region of 50k+. What would your reaction be if people said you should refuse half of it and take only the national average of about 25k because you can live perfectly well on that..? 

Well 50k isn't exactly a millionaires salary, I work extremely hard at what I do and the training I've undergone to be the best I can. When a British Airways captain takes home 100k to take people on holiday which is twice what I am paid, I'd be happy to tell people where to go and that I do earn the salary that I signed on for, except the salary and pension I signed on for has been changed 3 times in fact. You can't really compare 75 million to 50k. Grrclark, has hit the nail on the head and that is why I have a problem with it. 

Edited by Whatmuff

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13 minutes ago, grrclark said:

I think there are a few issues at play.  I agree that the help to buy scheme ended up being abused by the house builders, although I think the sentiment behind the scheme was sound, it was so poorly put into place it provided taxpayer subsidised profits for developers and that was not the intention.  Profit is a good thing and not a dirty word, but when those profits that were directly achieved as a result of government subsidy results in exorbitant payouts to directors then it does become a problem for me.

The size of the bonus in itself is extreme, but I accept that is what was written into his contract and if it was a bonus offered to me i would not be saying no because it might offend some other people.

Good post. 

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You're right,  50k isnt a millionaires salary, and believe me im not having a pop at you, but you miss my point. There are a large number of hard working  people for whom a 50k salary is just as unimaginable as a 75 mil bonus is. Its just that at certain levels of certain industries - housebuilding being a prime example - the numbers get silly. But thats capitalism and its always been thus. I'd be willing to bet that there are men on persimmon sites being paid substantially more to stick bricks together than you are to spearhead our nations defence... is that right? No but its the way it is.

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4 minutes ago, miroku mk70 said:

You're right,  50k isnt a millionaires salary, and believe me im not having a pop at you, but you miss my point. There are a large number of hard working  people for whom a 50k salary is just as unimaginable as a 75 mil bonus is. Its just that at certain levels of certain industries - housebuilding being a prime example - the numbers get silly. But thats capitalism and its always been thus. I'd be willing to bet that there are men on persimmon sites being paid substantially more to stick bricks together than you are to spearhead our nations defence... is that right? No but its the way it is.

Yup I have plumber mates that are on twice my wage. But you're right and I can't really argue with it. As Dan said I think I may just have let my emotions get the better of me.

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13 minutes ago, Whatmuff said:

Yup I have plumber mates that are on twice my wage. But you're right and I can't really argue with it. As Dan said I think I may just have let my emotions get the better of me.

How come it's always plumbers that are supposedly on £100 grand? I was a plumber and left to go in to roofing so I know loads of plumbers and not one of them is on that sort of money.

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