Lord Adair Turner, chairman of the Financial Services Authority, has admitted that Money Advice Service chief executive Tony Hobman’s £350,000 remuneration package was set too high.
Giving evidence to the Treasury Select Committee’s inquiry into the MAS last week, Turner said it was set in line with salaries of other FSA satellite organisations such as the Financial Services Compensation Scheme and the Financial Ombudsman Service.
He told the TSC: “I am not saying at the time I said it was a bit too high, I did not do that. You are asking me now, as I look at it in retrospect, and I think it was pitched somewhat high relative to what it would be and what it should be.”
MAS chairman Gerard Lemos said it is “a lot of money” but necessary to attract staff with a commercial background. He added next time the MAS recruits a chief executive it would start with a “clean sheet of paper”.
Hobman told MPs he has taken a pay cut of about £25,000 and waived his performance-related bonus.
He says: “I continue to believe that having taken the job in good faith at the rate that I was paid that I can demonstrate value for that.”