Mayflower bosses' pension safety net

DIRECTORS of Mayflower were switched into generous and ring-fenced final-salary pension schemes as the busmaker headed for the rocks, the Financial Mail on Sunday has revealed.

The timely move means that while the pensions of 4,500 workers are under threat after Mayflower fell into administration last week, chief executive John Simpson is guaranteed at least £300,000 a year.

Two other directors, David Donnelly and John Fleming, are also in line for six-figure pension payments. All three quit last week after a £20m hole opened up in the accounts. The shares were suspended and administrators were called in.

The controversial switch from a riskier money purchase scheme was made following a review by Mayflower's actuaries, Bacon & Woodrow.

According to Mayflower's latest pay report, signed off by City grandee Rupert Hambro, the value of Simpson's pension fund had risen by £604,000 to £5m. Under the terms of his contract, he may be entitled to another two years' worth of contributions, plus a pay-off of at least £947,000 - or twice his pay.

Mayflower, where former Prime Minister John Major was a non-executive director, is saddled with debts of £190m. It is feared the pension scheme, which has assets of £36m, has an £18m deficit.

No one was available for comment at Mayflower.