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Foxtons Fat Cats: Has the company been milking the taxpayer?

Foxtons is facing another shareholder revolt over the bonus being given to its chief executive despite taking £7m in state Covid support.

The BBC reports that Foxtons plans to hand CEO Nic Budden a bonus of £389,000. 

Budden's total pay package grew to £1.6m in 2020 compared to £1.25m in the previous year. And the BBC says this year's pay deal includes a long-term share award totalling £569,000 which can be accessed in five years' time.

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The row over Budden’s bonus has been building as Foxtons’ unapologetic use of taxpayers’ money has come under scrutiny.

Foxtons has benefitted from £2.5m in business rates relief as well as £4.4m in furlough payments for staff. 

Darren Jones MP, chair of the Business Energy and Industrial Strategy Committee, has told Yahoo Finance that businesses like Foxtons should repay government cash before giving money to investors.

He told Yahoo Finance: “As the business committee has said time and time again, business leaders need to act in good faith when using taxpayers' money during the pandemic.

"We have called out businesses who have passed on taxpayers' money to shareholders, instead of using it to keep workers in their jobs or returning it to the Treasury if it’s no longer required."

Now the shareholder advisory firm ISS is recommending investors to vote against Foxtons' remuneration report at its next AGM on April 22.

ISS adds: "Some investors may question the appropriateness of awarding bonus payments to the executive directors before paying back the government support received."

The BBC also reports that the Investment Association, which is a group of 250 fund managers, has issued a ‘red top’ alert on Foxtons' pay via its Institutional Voting Information Service. A ‘red’ alert by AVIS represents the highest level of concern over a particular issue.

And another shareholder advisory group, Glass Lewis, has told the Financial Times that investors should vote against the bonus at the AGM.

A spokesman for Foxtons has told the BBC: "Like many businesses, Foxtons was forced to close for months over the past year. We were very grateful for government support which we used for as short a period as possible but entirely as it was intended - to keep people in jobs during a lengthy closure.

“We did trade for a large part of the year, having stopped using the furlough scheme, and worked hard to support home moves and keep our tenants' properties safe and secure."

Earlier this week the company revealed that it had made a £3m investment in new portal Boomin, just weeks after spending £14m to buy the rival London agency Douglas & Gordon. In November, Foxtons paid £2.2m for Aston Rowe.

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    Sadly, the unacceptable face of capatalism.

  • Algarve  Investor

    An absolute joke and a disgrace. There's a strong argument that no-one in agency should be receiving such a huge bonus, even less during a pandemic, even less in a company which has taken full advantage of the furlough scheme and taxpayer subsidy.

    I know Foxtons have built their whole reputation off being shameless and Marmite, but this leaves a bad taste in the mouth. Maybe they're keen to wrestle back the mantle of property company everyone loves to hate from Purpblebricks and Boomin.

  • London Agent

    I’m was not aware of Foxtons, (and Douglas and Gordon - whom them have recently bought) closing their offices for months. At times less staff perhaps. Why am I not surprised by this?

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