Greencore, the sandwich supplier to grocers including M&S, Sainsbury’s and the Co-op, is the latest company to face criticism for offering bonuses to bosses while failing to repay government Covid support.
We take a look at some of the other UK firms that have handed bonuses to executives or payouts to shareholders despite refusing to refund taxpayers for support, including business rates relief and the furlough job retention scheme.
WH Smith
The retailer was a big beneficiary of taxpayer funds throughout the pandemic, having taken £40m in business rates relief and £11m in payments from furlough schemes in the UK and elsewhere in the year to September 2021. That was on top of £20m in business rates relief in 2020.
The move prompted a shareholder rebellion earlier this month, with more than half its investors failing to back a £550,000 bonus payment for the retailer’s chief executive, Carl Cowling, as a result.
Homebase
Restructuring group Hilco took a £25m dividend payment from the DIY chain Homebase in 2020, despite receiving business rates relief for the chain, which it bought for £1 in 2018. It also accepted at least £10.6m in government aid through furlough payments and grants for its Bathstore chain, which was forced to close for many weeks under government high street lockdowns.
JD Sports
The retailer JD Sports restarted dividend payments to shareholders in April 2021, after profits were shored up by bumper lockdown demand for trainers and hoodies. However, JD said it was not going to return either furlough money or business rates relief, which was worth £38m to company according to property advisers Altus Group.
Vertu Motors
Vertu Motors, the Gateshead-based car dealership group, relaunched its interim dividend in October despite receiving significant government support, including £22.8m from the furlough scheme and £4.3m in business rates during the first half of 2020. It has claimed a further £5.2m in business rates relief and £400,000 in job support payments since.
The company defended the move, saying it had held off from offering shareholder payouts over the past two financial years “in acknowledgement of the level of government support received”.
John Lewis
The John Lewis Partnership has been criticised for failing to repay more than £190m in business rates relief and furlough support.
While the company has not offered bonuses or dividends, it has faced criticism for the fact its Waitrose supermarket chain took at least £85m of that relief at a time when grocers were still able to stay open and serve customers even during Covid lockdowns. Chair Dame Sharon White said the group would hold on to the government cash, which had “helped to keep us running and avoid more severe restructuring”.
Greencore
Ireland-based Greencore tapped the UK’s state furlough programme for £21.3m in 2020, and a further £8.7m in 2021. While none of that taxpayer-funded cash has been repaid, Greencore paid €343,000 (£286,000) in share-based bonuses to its chief financial officer, Emma Hynes, for 2021, bringing her total pay to £895,000.
The company, which is billed as the world’s largest sandwich maker, has defended its use of government funding, noting the severe drop in profits it suffered at the height of the pandemic, when lockdown orders hit food-to-go sales at some of its biggest customers, including the supermarkets M&S, Sainsbury’s and the Co-op.
Greencore swung to a £10.8m loss in 2020, from a £56.4m profit a year earlier.
