The Green party has repeated calls for new legislation intended to reduce income inequality after a report released on Monday revealed that the median Financial Times Stock Exchange 100 Index (FTSE 100 Index) CEO now earns 118 times the median UK full-time worker.
The new report from inequality think tank The High Pay Centre, revealed that the median pay for FTSE 100 CEOs increased by half a million pounds between 2021 and 2022 – from £3.41m to £3.91m. Meanwhile, the median salary for full-time workers in the UK is only £33,000 according to the Office of National Statistics.
Cuts to executive pay during the height of the Covid pandemic shrunk the median pay gap between company executives and other workers, but the gap has since widened. Pay for FTSE 100 CEOs was on average 79 times more than the median worker in 2020, 108 times more in 2021 and is now the highest it has been since 2017.
This means that top CEOs received an average pay increase of around 15 per cent in 2022 while the pay of many workers failed to keep in line with inflation. The median worker’s salary has only increased by five per cent since 2021.
The FTSE 100 Index is a share index of the 100 companies listed on the London Stock Exchange with the highest market capitalisation.
The announcement also follows warnings by the Cambridge sustainability commission that the world's wealthiest one per cent produces twice the emissions of the poorest 50 per cent combined. The report, released in 2021, pointed out that dramatic changes would be necessary from this ‘polluter elite’ in order to meet climate goals.
Now, the Green Party has once again called for a policy to be put in place that would legislate a maximum 10:1 pay ratio between the highest and lowest-paid workers in any organisation.
Adrian Ramsay, co-leader of the Green Party, said: “The UK’s leading fat cat bosses are raking in obscene levels of pay while many of their workers struggle to make ends meet in a cost of living crisis. That’s why the Green Party is repeating a call for a 10:1 pay ratio, mandated by law, to ensure that the highest paid individuals in an organisation receive no more than ten times the amount of the lowest paid.
“Such a policy would drive an uplift in wages for the lowest-paid workers while addressing rampant and ever-widening inequality.
“We also know [that] it is the wealthiest that are having a hugely disproportionate impact on the climate crisis. The world’s richest one per cent are responsible for 15 per cent of carbon emissions, nearly twice as much as the poorest 50 per cent. It is clear that a 10:1 pay ratio would help create a fairer and greener country."