Cable targets ‘irresponsible’ companies rewarding failure

A four-fold increase in pay for FTSE100 chief executives since 1998 has convinced Mr Cable the system of remuneration has become “dysfunctional”, with too many bosses seeing pay packets soar in contrast to the fortunes of their company.

Under a new system to be unveiled by Mr Cable in his speech to the Liberal Democrat conference in Birmingham, companies will be ordered to explain how they have decided on pay and perks.

And instead of scattering details of executive board member’s salary, pension, bonuses, and shareholdings in different parts of an annual report, the sums will be brought together in one table – giving a total figure to shareholders for the first time.

He will float a series of other proposals aimed at tackling undeserved multi-million pound packages, including putting employee representatives on remuneration committees.

Mr Cable will insist there is “nothing wrong with generous rewards” for successful businessmen, but will add: “People accept capitalism but they want responsible capitalism.

“I want to call time on payouts for failure”.

The plans are likely to go down well with delegates at the conference, at which senior Lib Dems lined up yesterday to warn their Tory coalition partners they will not allow the 50p tax rate to be abolished without an alternative plan to target the wealthy.