Qantas AGM 'pretty fiery affair'
Qantas AGM a 'pretty fiery affair' over executive remuneration, Ian Verrender reports.
QANTAS chairman Leigh Clifford and his board have been reprimanded by shareholders for a second consecutive year for lavish payments to former boss Geoff Dixon.
Almost 43 per cent of votes were cast against Qantas' executive pay at its annual meeting in Perth yesterday, following outrage over a $3 million compensation payment this year to Mr Dixon for tax changes in 2006. Last year more than two-fifths of votes were cast against Qantas' remuneration report mainly because of concerns over Mr Dixon's pay.
The compensation paid to Mr Dixon boosted his final pay to almost $11 million.
''Shareholders are angry - they want change. They are out of pocket in terms of the market value of their shares and the dividend,'' one shareholder said. ''The pockets of executives seem to be as full as ever, particularly those of Mr Dixon.''
Mr Clifford spent a large part of the meeting justifying to shareholders the payment to Mr Dixon. He emphasised that it was important to put Mr Dixon's contract in the context of uncertainty over the airline's future in the aftermath of the failed private-equity bid in 2007 and the need to retain senior executives at a critical juncture.
''We have a remuneration policy going forward that I think is quite acceptable,'' he said. ''Geoff's final termination payments were in accordance with a contract put in place some years before. He was a chief executive who, by any standards, had done a good job.''
But a union official pointed out that compensation for retrospective tax changes was not available to other Qantas staff.
Another shareholder asked why the board had agreed to ''a contract of such generosity''.
The compensation to Mr Dixon related to $7.66 million paid into his super account when he signed a new contract in August 2006 - four months before the board endorsed the doomed private-equity bid for the airline.
Shortly after the payment was made, the Howard government imposed a $1 million cap on contributions, exposing him to substantial tax penalties.
But several months later Mr Dixon took advantage of a ''transitional period'' to withdraw the money from his super account and avoid the tax penalty.
James Strong, chairman of Qantas' remuneration committee, dismissed suggestions that the $3 million paid to Mr Dixon was a ''discretionary payment''.
