Armchair audit is raising its sights. As well as looking as councillors like Brian Coleman, it is now turning the spotlight on auditing the seriously wealthy to see if they follow David Cameron’s dictum that we are in it all together.
Francis Maude is the public face for taking on the public sector trade unions and insisting their low paid members are being offered the best possible pension terms which anyone in the private sector will be really envious.
But is everyone in the private sector worse off than public sector workers? Not Mr Maude for a start.
He has taken one hit and is about to take another since he rejoined the Conservative led coalition.
His Cabinet Office minister salary is £98,740 (includes MP’s salary of £65,738). This is a reduction of £5197 on his Labour predecessor, Tessa Jowell.
It is his pension history which marks the real divide. When he reaches retirement age at 2018 he will be able – unlike his public sector colleagues – to be able to draw FOUR pensions.
He will get the state pension – promised by the coalition to reach £140 a week – which will go to everybody.
He will get TWO public sector pensions – one as an MP and one as minister. Their arrangements are hideously complicated – and not as open as figures available for public sector workers.
As an MP since 1983 of 28 years standing ( he was out of parliament between 1992-97) by 2015 he will entitled – assuming a virtual wage freeze – to a pension of around £31,000 a year because he has a private sector pension and this taken into consideration to save taxpayer’s cash. Otherwise it would be worth over £46,000.
But while workers will be paying higher pension contributions Mr Maude is able to pay less under this deal. His contribution rate drops from 7.9 per cent to 5.9 per cent.
His minister’s pension by 2015 will be worth over £10,000 a year. His contributions, to be fair, are now 11.9 per cent and will rise to 18 per cent.
This gives him a state pension in excess of £40,000 a year – TEN times the average pension of lower paid civil servants bearing the brunt of the cuts and FIVE times the average civil servant pension. For that matter it is also FIVE times the average teacher’s pension.
But this is by no means the full picture. These calculations miss out Mr Maude’s private pension – which is a huge elephant in the negotiating room.
During the period he was out of office Mr Maude was director of 27 companies between 1992 and 2011. Six were dissolved and three went bust.
But standing out from the lot is a period of over two years from February 1994 to November 1996 when Mr Maude was managing director of investment bankers,Morgan Stanley, in London and New York.
The accounts are still available at Companies House and the salaries – paid in 1990s money – were stratospheric for directors.
The highest paid director’s salary went from £786,873 in 1994 to £1,234,690 in 1995 and to £1,708, 063 in 1996 – a rise of well in excess of 100 per cent. And that excludes pension payments.
Mr Maude’s salary is not identified – but as MD in two countries – it will be nearer to those figures – plus a pension to boot.
The Cabinet Office declined to comment on his private pensions arrangements. But a City management consultant told me:
“It would be inconceivable that Morgan Stanley would not have paid Mr Maude a high pension because it is a much more tax efficient way of paying out money. Often City firms offer pensions equivalent to say 10 years service, rather than three, as a way of giving more money to people when they leave.”
Indeed Mr Maude had a lot of spare cash in 1996. Land registry records reveal that on 1st August 1996 Mr Maude and his wife Christina, bought for cash a large farmhouse and land at Dial Post in West Sussex. Property around there with land goes now for sums well in excess of £1m.
Perhaps the time has come for Mr Maude to reveal his true pension status when he is lecturing people to settle for less for life. He is the Government’s Mr Transparency and has released lots of personal data on individual civil servant’s pay and pensions.
Just this weekend, his boss at the Cabinet Office, Nick Clegg, called for more transparency on top executive pay and perks. Mr Maude could lead by example by revealing the historic facts of his secret pension deal.
My guess is that he has a private fund worth well over £1m on top of his three other state pensions. Prove me wrong, Mr Maude.
You can of course express your own views – you might feel Francis Maude is worth a mega pension, or you may feel he doesn’t deserve anything like it.. You can e-mail him on email@example.com .