Bosses in the money at Mayflower

EXECUTIVES at bus and truckmaker Mayflower Corporation, where former Prime Minister John Major sits on the board, have received bumper pay rises - but they still won't be subscribing to the company's £67m rights issue.

Chief executive John Simpson is reported to have earned £400,000 last year. But analysis of Mayflower's latest annual report reveals he actually received £830,000 in salary and free bonus shares, an increase of 68% on the previous year. Total boardroom pay shot up by 43% to £2.7m.

Details of the boardroom bonanza comes as shareholders prepare to vote on the rights issue on Friday. The directors, who own about 4% of Mayflower, have been criticised for asking shareholders for cash while refusing to back the company by dipping into their own pockets to subscribe.

Simpson is said to have pleaded personal poverty. Taking up his rights would have cost about £630,000. But apart from a swollen pay package, Simpson has also recently benefited from a controversial £2.2m 'catch-up' payment into his pension fund.

Major, who is backing the rights issue, is thought to be earning £1m from various roles. He picked up £111,000 from Mayflower last year - a large sum for a non-executive director who must attend just four board meetings a year.

The pay rises came despite a miserable year for Mayflower, where profits before one-off items fell by 40% to £30m, the dividend was slashed and the share price languished. The company, which supplies Land Rover and Aston Martin in Britain, has been hit by the downturn in the US automotive market

Simpson has admitted that the reasons for the cash call are 'a bit vague'. The money will be used to strengthen the balance sheet, make acquisitions and fund overseas expansion.

Mayflower has debts of £211m, though it insists it has met the terms of its loans.