Media Forum: Is C4's Duncan worth £1.2m?

Does the chief executive deserve his 2007 pay packet, Alasdair Reid asks.

Prime Minister Gordon Brown earns £187,000. Not unreasonable, especially as he also has the use of a couple of quite nice houses while he's in the job - but slightly less than satisfying, really, compared with the £200,000 taken home by the National Health Service chief executive, David Nicholson CBE.

No-one (bar a few nurses, junior doctors and hospital cleaners) really begrudges him this, though - he does, after all, run a £90 billion organisation that is one of the world's largest employers, its headcount of 1.3 million placing it just behind the Chinese People's Liberation Army, Wal-Mart and Indian Railways.

But imagine how envious both Brown and Nicholson are of Channel 4's chief executive, Andy Duncan, who is also a public servant of sorts, yet whose total take-home package for 2007, it was revealed last week, was £1.2 million - almost double what it was in 2006.

A fair whack? Channel 4 is, after all, a £1 billion organisation with a headcount of just under 1,000 and has a nationally important public-service remit to ensure that every household in the country receives uninterrupted coverage of events within the Big Brother house.

On the other hand, Duncan has not exactly had the best of years. The publication of Channel 4's annual report last week revealed a loss (the first since 1992) of £7.8 million last year. True, this is an outcome that won't exactly upset Duncan as he continues to advance his case for future government handouts in order to safeguard the Channel 4 remit.

But some believe he's embarked on a dangerous game of emotional blackmail with the Government and Ofcom. You could argue, for instance, that the channel is in no position to take the moral high ground where the issue of public-service broadcasting is concerned, given some of the programming strategies it has been pursuing over the past couple of years.

Few could argue it has been a vintage year. That's as maybe, Andrew Constable, the head of media at Coors Brewers, says - yet he argues that the only problem here is with the timing of the whole business.

He explains: "From a headline point of view, you have to admit that it doesn't look good when this comes out at a time when he's asking the Government for more money. But, though Channel 4 is a publicly owned company, it's required to act in a commercial manner - and that includes paying what you need to pay to make sure you have the best people."

Perhaps, Phil Georgiadis, the chief executive of Walker Media, concedes. But he maintains that we're begging an even bigger question - the fact that we're curious about Duncan's salary only goes to underline the need to privatise Channel 4. Then the marketplace could truly judge his value. He says: "It's true that where any organisation is concerned, you need to pay competitive rates to attract the best people. The issue to me isn't about what he's paid, but about whether he's accountable or not."

However, Gary Birtles, the Initiative chief executive, argues that, by any measure, Duncan delivers: "If you compare what he earns with what a doctor earns, for instance, then you might argue he's not worth £1.2 million. But that's not the way things work. Duncan is part of small group of people who are genuinely creative leaders in the broadcast environment."

And Neil Jones, the managing director of Carat, tends to agree. He says: "I know he's not the only talented person down there, but much of the innovation is driven by him, and I think he's just generally good for morale within the organisation. That's why he gets paid what he gets paid. It's also true that people in TV generally are well paid and his remuneration is not out of line with what you'd expect in the industry. But you also have to point out that his basic salary has not gone up by much and a lot of this headline figure is made up of payments from a loyalty scheme that's always been in place and is only just starting to come to fruition. I really don't think that's unreasonable."

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YES - Andrew Constable, head of media, Coors Brewers

"He's doing a very good job at Channel 4, so if his salary is in line with what he could expect to be paid in the private sector - and I believe it is - then what he's being paid is probably fair and reasonable."

MAYBE - Phil Georgiadis, chief executive, Walker Media

"If you look at salaries at the top of comparable media owners companies, Duncan's is not out of kilter. But their salaries are subject to the scrutiny of shareholders who demand value for money."

YES - Gary Birtles, chief executive, Initiative

"At first glance it seems a big number, but in the context of the role he has and the number of people in the market who could genuinely do his job, then he is basically worth what the organisation is prepared to pay."

YES - Neil Jones, managing director, Carat

"I think he has been brilliant - a real visionary. You can argue that Channel 4 is still the most forward-looking television station, not just in programming terms, but in terms of the way it has been seeking to meet the challenges of the digital environment."

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