The Co-operative Group has announced it will award bumper pay rises to senior staff over the next two years, despite the near collapse of its banking arm.
According to a report in The Observer, new chief executive Euan Sutherland is set to receive total compensation of £3.66m this year, with a basic salary of £1.5m, despite conceding last month that 2013 had been one of the worst in the lender’s history.
Chief operating officer Richard Pennycook will be awarded £1.8m in total, while 12 senior executives will also receive significant pay increases.
According to The Observer, the Co-op will pay more than £24m over two years to just eight executives, compared with total compensation for 13 top executives last year amounting to just £6m.
The group is also set to announce losses exceeding £2bn for 2013, after discovering a £1.5bn black hole in its banking division.
This follows the arrest of former Co-op chairman Reverend Paul Flowers on drugs allegations after he was filmed buying crystal meth and crack cocaine last year.
The Labour Party, which shares close ties with the Co-operative Group, has labelled the decision to award the pay rises as ‘disappointing’.
On Sunday, shadow chief secretary to the Treasury Chris Leslie MP said: “I think this is very disappointing. I believe in mutuality, I believe in the co-operative principle but I happen to think that Co-op should be acting differently.”