Newspaper article The Journal (Newcastle, England)

Judgement Reveals Details of Pair's Controversial Bonuses

Newspaper article The Journal (Newcastle, England)

Judgement Reveals Details of Pair's Controversial Bonuses

Article excerpt

THE High Court airport judgement reveals for the first time how former chief executive John Parkin secured a PS6m bonus and a controversial new job.

The former chief executive and the now deceased finance director Lars Friis secured bonuses worth PS8.5m, after the airport board failed to check on contract changes.

The contract moves eventually allowed Mr Parkin to secretly work for Leeds/Bradford Airport, a company he was advising while securing his Newcastle bonus and whom he is now chief executive of.

Eversheds, the city legal firm which was exonerated, was brought in by the airport to help put together the new contracts.

A judge last week said Eversheds had no reason to belive Mr Parkin's instructions were not authorised, and revealed that remuneration committee chair Rosemary Radcliffe on many occasions failed to take note of the firm's contract advice.

The 31-page judgement shows that in 2002 Mr Parkin's contract contained a limited bonus scheme handing him a relatively modest PS250,000 if the airport's pre-tax profits were PS30m or more by 2005, alongside a separate bonus of up to 50% of his annual wage if yearly targets were met.

Mr Friis by 2004 had a similar but less rewarding bonus deal in his contract.

In 2002 the initial contracts for the pair included an agreement which prevented them from providing any advice to 10 rival airports, including Teesside and Leeds/Bradford. Newcastle Airport considered these airports to be providing services in competition with themselves, and bosses say they heard Mr Parkin say this himself on a number of occasions.

After 2005 the contractual arrangements for the bonuses had expired and the pair were ready to negotiate their new arrangements. Around the same time the airports debt was due to be refinanced.

The judgement reveals that Mr Parkin and Friis had been aware that their equivalents at Bristol Airport had a bonus agreement related to refinancing and believed they should receive a similar deal, with Mr Parkin emailing Ms Radcliffe about his need for " a fair share of the proceeds". Around this time David Slater, then at South Tyneside Council and now at Newcastle, sent a warning note about the bonuses, but this was not acted on. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.