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Newsquest's smoke and mirrors fail to mask obscene sums for those at the top

Newsquest strike  -  © NUJ

14 October 2015

Newsquest's latest accounts show it made £60 million before tax while saving £5m by sacking 228 staff and paying many below a living wage.

Newsquest, owned by the American company Gannett, publishes 200 newspapers, magazines and trade publications including the Brighton Argus, Southern Daily Echo and Glasgow Herald. The company's latest accounts reported that Newsquest made £58.65m, pre-tax, despite revenue falling marginally by 3.2 per cent to £279.33m.

The job cuts made between the end of 2013 and the end of last year brought staff numbers down to 3,997.  The wages bill fell 3.3 per cent to £109.89m and overall staff costs were down £5.2m or 3.9 per cent.
Pay rose overall for the directors by 3.9 per cent to £655,000. This was almost entirely taken up by chief executive Henry Faure Walker and Paul Hunter, finance director.

Henry Faure Walker's base pay, in his first full year as chief executive, was £401,505, a third less than that of his predecessor Paul Davidson at £610,000. But that is not the whole story. It appears to represents a new contract that has shifted a greater chunk of the top executive's pay to bonuses. The accounts show a huge 26 per cent rise in bonus "performance related payments" of more than a third of a million pounds (£338,000) for those same directors.
 
The picture is further clouded by the arcane and complicated system of share options granted to senior personnel which the NUJ has evidence goes right down to regional-level managers.  Included in the wages bill is £1.51m in share-based payments and a further £3.19m "recharges" for the value of share options exercised. Suffice to say, these payments did not make their way down to the vast majority of staff in the newsroom.

Chris Morley, Newsquest NUJ group coordinator, said:

"These accounts mask the real burning issue in Newsquest: that of pay and the fairness of pay.  We have been used to seeing the obscenity of previous chief executive Paul Davidson luxuriating in a hugely inflated pay packet while his staff were left on the margins of living decently. In Henry Faure Walker's first full year at the helm, we see on the surface his base pay has been slashed by a third but with a slight of hand, magically 'performance related bonuses' turn that around.

"This is still a very profitable company whose employees are on their knees with year after endless year without a pay rise. This has to stop in 2016 and staff must share in the one-sided gain the company is reaping from massive productivity increases coming through the grim conveyor belt of job losses. We call on Henry Faure Walker, now the company is freed of its debt burden yoke following the demerger of the US parent company, to start reviving the crushed morale of his staff with immediate pay boosts."

Laura Davison, NUJ national organiser, said:

"These figures show up the thin tales of hardship spun by local Newsquest bean counters for what they really are. It is journalists and other low paid workers who have paid the price for these gains - with their jobs and with consecutive years of pay freezes. Meanwhile quality suffers but readers are not only expected to fill the papers with their own free content but then buy it back. It's simply not a sustainable strategy."

 In May, Newsquest acquired 29 more titles through the acquisition of Romanes, which operates newspapers including local daily paper the Greenock Telegraph. The accounts show Newsquest paid £15.2m to buy the group.

A survey of more than 700 journalists, carried out over summer by the Press Gazette, found that journalists working for Newsquest were the least happy of those working for major regional newspaper publishers. This summer, staff in Newsquest’s titles in south London were forced to call a 12-day strike over cuts and poor pay, including some staff being paid less than the London Living Wage.

Newsquest accounts 2014

Tags: , local news, local news matters, newsquest, newsquest south london, pay, accounts, executive pay