Living Wage (Supplementary) [3]

I will ask my Chair to answer on my behalf but I could talk to the people that report to me. I think we said at the very start, and we made this very clear with Government, what we did not want to do was to have people that were on public sector terms and conditions and then hire a very expensive consultant because we could not attract the right people into the ODA and then pay two or three times that amount to have the consultants who, clearly, had an agenda for a separate sector of shareholders.

Therefore, what we said is we want to pay something closer to a commercial rate but, in return for that, what we will insist on, that the terms and conditions of people that work within the ODA are performance related; so no bonus is paid unless there are clearly set out milestones. We set all of our performance milestones out a year in advance. They are very, very quantifiable in terms of budget or milestones of progress and timetable.

Then, in terms of terms and conditions, many people moved off Government pensions to come into the ODA, realising that it was a finite job. We have already started downscaling parts of the ODA and our partners, even though we are just hitting peak production rates, so everyone knows they are here for a limited life. Most of our staff will not be here at the Games; most of the people will be finished and laid off by the time we hit the Games; so what we need is our staff and our senior staff, right through our organisation, really, really focused on performance and then they finish the job and they go. That is why we have put in place performances and bonuses to motivate the staff and our major delivery partners.

Richard Tracey (AM): With respect, you have not answered my question. I asked you about foregoing the bonus until you are finished the job; not actually giving it up altogether but simply foregoing it, as you did part of your bonus.

John Armitt (Chairman, Olympic Delivery Authority): If I can deal with that because, at the end of the day, the remuneration of the Chief Executive and, indeed, of the other directors, is the responsibility of the Board and the Remuneration Committee. It is very clear that these people as David [Higgins] has already said, most of them left major organisations to come and do a temporary job and it is very important that they be properly and sensibly paid for that. In any situation like this, you would expect to pay a sensible salary, together with an opportunity to meet, as we have to do here, a whole series of targets, and reflect that in a bonus system.

Those targets have been met. They have been very carefully set. They are then audited, as you would expect in a public sector body, and, in fact, this year, the Remuneration Committee made the decision not to actually pay bonuses greater than the previous year, notwithstanding the fact that, in fact, they had been earned slightly higher than the previous year. The Remuneration Committee decided to pay no more than had been paid the previous year.

There was no pressure whatsoever, by us, on David, to take a reduction at this point in time and to defer his bonus to later on. That was a personal decision made by him. As far as we were concerned, as a Board, we did not expect him to do that and, indeed, it was a personal decision made by him, but I do not think we should put any pressure on him, whatsoever, to actually defer what he has earned.

In my introductory statement I made it very clear that this project is going well, it is on time and it is on budget and there is no room for complacency going forward, but I do not think it is reasonable to expect people to take a reduction in their bonus in those circumstances.

Richard Tracey (AM): We heard quite a lot from the Chancellor and from the Leader of the Opposition and from various other people about bonuses in the City across the river. I would have thought that you might consider that the same parameters, frankly, apply. We are not asking you to give it up; we are asking simply for possible deferment until you finish the job, which we are all looking forward to you doing.

John Armitt (Chairman, Olympic Delivery Authority): There is no comparison whatsoever. The bonuses which are earned on the Olympics are relatively low level bonuses compared with millions which have been paid in the City. The City has had its problems. The City, as we have heard on many occasions, has not done all the things that it set out to achieve. The ODA has done all the things that it set out to achieve. In those circumstances I think it is fair that people should be sensibly rewarded.