Channel 4’s top executives have deferred taking bonuses worth hundreds of thousands of pounds and scrapped a planned pay rise, amid a growing backlash from struggling TV producers hit by the broadcaster’s cuts to programme-making.
The chief executive, Alex Mahon, chief content officer, Ian Katz and chief operating officer, Jonathan Allan, are still on course to take home millions in pay and other bonuses, details of which will be confirmed when Channel 4 publishes its annual report later this summer.
Last week the Guardian revealed that Mahon could end up receiving the biggest pay packet for a chief executive in Channel 4’s 40-year history, partly due to a loyalty bonus that management and staff are in line to receive to reward their commitment during the government’s aborted plans to privatise the broadcaster.
The additional payment, which comes on top of performance-related bonuses, amounts to 25% of base salary for top and senior executives, then 20% for other management and 15% for regular staff.
On Monday, Channel 4 said that Mahon, Katz and Allan would now indefinitely defer taking this retention bonus, which totalled about £400,000 between them, and have decided not to take an annual pay rise this year. Other Channel 4 staff will receive a retention payment and pay rise.
The broadcaster said the decision had been taken in response to a slump in the ad market in the second quarter that is affecting all broadcasters.
A spokesperson said: “Whilst the remuneration committee agreed a retention scheme for the executive directors alongside the rest of the organisation last year, the executive directors have already made the decision to defer their payment and earlier this year declined a salary rise as part of a wider response to a very difficult ad-market in the second quarter, which is affecting all commercial broadcasters.”
The slump in advertising, which Channel 4 relies on for the vast majority of its revenues, has resulted in the broadcaster cutting back spending on shows and cancelling commissions, which has sparked ire among TV production companies in the independent, or indie, sector.
The broadcaster said the decision that bosses would delay taking the retention bonus and not take a pay rise had been taken several weeks ago, as an acknowledgment of the financial pressure that the hundreds of TV producers that work with it are now under.
However, this was not mentioned when the Guardian sought a response to last week’s news story on the potential record executive pay top management were in line to receive.
“Channel 4 cares deeply about the indie community and our wider supply chain of freelancers. They are the beating heart of our business,” said the broadcaster’s spokesperson.
“While we recognise the actions we are asking of some are causing some short-term pain, the plan we have in place underscores our ongoing commitment to our financial sustainability and our continued support of the UK’s independent production sector.”
