May 19th, 2009

Bajnai pushes for 50% pay cut for board members of state firms

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Prime Minister Gordon Bajnai initiated a 50 percent reduction in pay to board members of state-run companies, in parliament on Monday.

The prime minister has instructed the state asset management agency to set a cap of 2 million forints (6,965 euros) on salaries paid to top managers at state-run firms. He added that pay in excess of that amount should be offered for charitable purposes.

Bajnai said that he had instructed his ministers to take similar measures for companies in their own portfolios.

The spokesman of the main opposition Fidesz party called the prime minister’s move a “pathetic trick”. “What Bajnai means to say is that the heads of mismanaged and ill-functioning state companies will make ten times the average salary,” Peter Szijjarto said. He also reiterated an earlier Fidesz proposal that board members’ pay should be reduced to average wage levels and the current boards should also be slimmed to three-member bodies.

The average wage in Hungary was 191,000 forints (EUR 667) before tax last year.

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  1. hand2mouth says:
    May 19, 2009 at 5:32 pm

    These salary figures are monthly ones, in case anyone is wondering….

  2. Nyalasi says:
    May 19, 2009 at 8:20 pm

    The top monthly compensation any of these government-jerk “managers” and “board members” (ha-ha–ha-ha) should be getting is 99 euros. Maximum. Anything over that amount would be a total waste, since these are not exactly Harvard Business School MBA propgram caliber “biznicmen,” you know what I mean?

  3. Godot says:
    May 20, 2009 at 5:27 pm

    It may sound silly, but what if these key management positions would be filled with people who actually know what the hell they are doing and not by friends and family? What if they would get paid a lot of money if the company is doing well, and minimum wage if not. Just an idea…

  4. Nyalasi says:
    May 20, 2009 at 7:23 pm

    These Hungarian biznicmen and board members would not last a week at any for-profit company operating overseas in North America, Australia, Japan, South Africa, etc.

    Maybe in less-demanding Europe they would prosper, however?