The chairman of Lloyds Bank has said the company plans to prioritise its junior staff as he was accused of giving employees a pay rise that “doesn’t even touch the sides” as the cost of living soars.
At its annual general meeting on Thursday, Robin Budenberg said the bank is thinking about how its lowest-paid staff are faring during the crisis, with inflation expected to hit 10% later this year.
“Our colleagues, especially at a more junior level, are impacted by the rising cost of living and our 2022 pay budget will seek to prioritise spend towards these individuals,” he told shareholders.
“All awards are determined by the board’s remuneration committee following extremely careful consideration against our policies scorecard.”
His comments came as members of the union Unite gathered outside the meeting hall in Edinburgh over a pay dispute with the bank.
One of the union’s members, Rachel Boothroyd, spoke to the board inside the meeting hall.
“We want to know how you can justify paying £1.4 billion to shareholders … and significant pay rises for non-executive directors, while giving staff a pay rise which is well below current inflation levels as they try to survive the worst drop in living standards since the 1950s,” she said.
Ms Boothroyd added: “The bank made £5.9 billion in profit last year. The money is there without a doubt.”
Mr Budenberg said: “I would say the board has taken a pay rise of only 1%.
“We did have a pay settlement of 3.6% this year. We very much focus that on lower-paid people so that everyone in the organisation got a pay increase of at least £1,000, which we felt was important given the current circumstances.”
He added: “Obviously, we continue to think about how our staff are faring in this difficult time.”
Ms Boothroyd said a lot of staff “in their pay are seeing a rise of £30 to £40 a month, which as we know, goes absolutely nowhere near inflation, the increase in household bills, food expenditure and national insurance rises”.
She added: “It doesn’t even touch the sides. We’ve had members telling us they’ve had to relocate because they can’t pay their rent, and that they’re having to opt out or reduce their pension contributions.”
Mr Budenberg said the £399 million the bank pays in bonuses is lower than many other major UK banks.
He added: “However, we know that as we deliver the next phase of our strategy it’s vital that we’re able to attract and retain talent and reward our colleagues appropriately.
“Our bonus awards are directly based on a percentage of our underlying profit.”
In results from a shareholder vote, 96% of votes were cast in favour of the company’s remuneration plans for top managers.