BT 2007 Annual Report Download - page 65

The annual salaries of the Chairman, Andy Green, Ian Livingston
and Paul Reynolds remained unchanged during the financial year
2006/07. Ben Verwaayen’s annual salary was increased from
£700,000 to £750,000 and Hanif Lalani’s annual salary was
increased from £400,000 to £460,000, both on 1 June 2006.
Following this year’s review of annual salaries, Ben
Verwaayen’s salary will be increased from £750,000 to
£800,000, Andy Green’s salary will be increased from £500,000
to £520,000, Hanif Lalani’s salary will be increased from
£460,000 to £520,000, Ian Livingston’s salary will be increased
from £525,000 to £560,000 and Paul Reynolds’ salary will be
increased from £450,000 to £475,000. All increases will be
effective from 1 June 2007.
Franc¸ois Barrault receives an annual salary of E750,000
(approximately £500,000).
Annual cash bonus awards in respect of the financial year
2006/07, which are not pensionable, to executive directors
ranged from 96.5% to 117.85% of current salary (2005/06 –
80% to 112%).
Former directors
Sir Peter Bonfield received, under pre-existing arrangements, a
pension of £359,900 payable in the financial year 2006/07
(2005/06 – £352,153).
Loans
Prior to the date of his appointment to the Board on
19 November 2001, Paul Reynolds had an interest-free loan of
£300,000 from the company to assist with relocation. At
31 March 2007, he owed £170,000 (31 March 2006 –
£200,000). During the financial year 2006/07, the maximum
amount outstanding was £200,000. There are no outstanding
loans granted by any member of the BT group to any other of
the directors or guarantees provided by any member of the BT
group for their benefit.
Pensions
Sir Christopher Bland is not a member of any of the company
pension schemes, but the company paid a cash amount of
£15,186 representing a retirement allowance for the financial
year 2006/07.
Ben Verwaayen is not a member of any of the company
pension schemes, but the company has agreed to pay an annual
amount equal to 30% of his salary towards pension provision.
The company paid £32,580 into his personal pension plan, plus
a cash payment of £189,920 representing the balance of the
pension allowance for the financial year 2006/07. BT also
provides him with a lump sum death in service benefit of four
times his salary.
Ian Livingston is not a member of any of the company
pension schemes, but the company has agreed to pay an annual
amount equal to 30% of his salary towards pension provision.
The company paid £55,665 into his personal pension plan, plus
a cash payment of £101,835 representing the balance of the
pension allowance for the financial year 2006/07. BT also
provides him with a lump sum death in service benefit of four
times his salary.
Andy Green is a member of the BT Pension Scheme. From
31 December 1997 the company has been purchasing an
additional 203 days of pensionable service each year to bring his
pensionable service at age 60 up to 40 years. A two-thirds
widow’s pension would be payable on his death.
Hanif Lalani is a member of the BT Pension Scheme but has
opted out of future pensionable service accrual. A two-thirds
widow’s pension would be payable on death. The company has
agreed to pay an annual amount equal to 30% of his salary
towards pension provision. A cash payment of £135,000 was
therefore made for the financial year 2006/07.
Paul Reynolds is a member of the BT Pension Scheme but has
opted out of future pensionable service accrual. A two-thirds
widow’s pension would be payable on death. The company has
agreed to pay an annual amount equal to 30% of his salary
towards pension provision. A cash payment of £135,000 was
therefore made for the financial year 2006/07.
The table below shows the increase in the accrued benefits, including those referred to above, to which each director, who is a
member of the BT Pension Scheme, has become entitled during the year and the transfer value of the increase in accrued benefits.
Accrued pension
Transfer value of accrued
benefits
Change in
transfer value
c-d less
directors’
contributions
Additional
accrued
benefits
earned in the
year
Transfer value
of increase in
accrued
benefits in e
less directors’
contributions
2007 2006 2007 2006 2007 2007 2007
£000a£000b£000c£000d£000 £000e£000f
A Green 167 157 2,879 2,448 401 2 13
H Lalani 126 112 1,394 1,144 250 9 98
P Reynolds 140 140 2,160 1,995 165 – –
a-d As required by the Companies Act 1985 Schedule 7A.
a-b These amounts represent the deferred pension to which the directors would have been entitled had they left the company on 31 March 2007 and 2006, respectively.
cTransfer value of the deferred pension in column (a) as at 31 March 2007 calculated on the basis of actuarial advice in accordance with Actuarial Guidance Note GN11. The transfer value represents a
liability of the BT Pension Scheme rather than any remuneration due to the individual and cannot be meaningfully aggregated with annual remuneration, as it is not money the individual is entitled to
receive.
dThe equivalent transfer value but calculated as at 31 March 2006 on the assumption that the director left service at that date.
eThe increase in pension built up during the year, net of inflation. The gross amount can be calculated by deducting the amount under column (b) from the amount under column (a).
fThe transfer value of the pension in column (e), less directors’ contributions.
gDirectors’ contributions in the financial year 2006/07 were as follows: Andy Green, £30,000 (2006 – £30,000); Hanif Lalani £nil (2006 – £24,000) and Paul Reynolds £nil (2006 – £26,000).
Report of the Directors Corporate governance
64 BT Group plc Annual Report & Form 20-F