Newsquest profits from cuts
7 October 2010
Newsquest's continuing attack on its own journalists combined with greed in the boardroom has been exposed – by the company's own figures.
The group is in the process of dismantling its final salary pension scheme and many staff have been without a pay rise for more than 1,000 days. New figures released by the NUJ show that the company cut the number of editorial staff by a massive 17 per cent last year.
Latest accounts for parent company Gannett UK show that the average number of editorial staff fell by 327, from 1,936 to just 1,609.
At the same time, the highest paid director enjoyed a massive £108,000 – or 21.5 per cent – hike in his overall pay to £609,235. In addition, he managed to secure for himself a further huge boost in pension contributions from £38,500 in 2008 to £95,000 last year – a 59 per cent increase.
This would seem to largely come from "performance-related payments" that soared for directors from £131,000 in 2008 to £279,000.
However, with the company telling the rest of the staff there is no end in sight to the pay freeze, it unveiled an operating profit of £71.7 million – turning round a paper loss of £462 million the previous year, arising from a devaluation of publishing rights and titles hammered by cuts.
It goes on to boast that "the underlying businesses remain profitable and cash generative".
Then it predicts that it expects to see a gradual recovery in the economy which would have a "positive impact on revenues", although it is unsure exactly when this will happen or the extent.
The swingeing cuts already made sliced the salary bill by £50 million in 2009 to £148 million and the figures also show "other pension costs" fell by £7.5 million, revealing large costs savings by the company. Furthermore, it got a multi-million pound windfall from the taxman in the shape of lower corporation tax that will continue to fall to 2014.
The accounts were filed with Companies House just days ahead of the 30 September deadline.
Chris Morley, Northern & Midlands Organiser, said:
"Newsquest shares very little financial information with its employees and with the figures like these, we know why.
"This is still an extremely profitable company diverting its wealth from the UK and its staff into the pockets of US shareholders and the banks Gannett borrowed from to buy Newsquest in the same manner as the Glazers bought Manchester United.
"The UK arm cannot continue to be the poor relation either within the group or its industry peers in this country. Good, loyal staff will vote with their feet if the cuts don't stop and better pay and conditions are put on the table immediately.
"Our members are at breaking point so the company has been warned."