Directors' pay likely to be passed at annual general meeting despite lobby group recommendation to vote no

Bellway shareholders are set to approve the housebuilder’s proposals for directors' pay at its annual general meeting on Friday.

The approval will come despite a recommendation from shareholder lobby group PIRC that shareholders vote against the proposal on the grounds the criteria for awarding the payments were too narrow.

A Bellway spokesman said: “From the votes we have had in already, it is clear the recommendations will be passed resoundingly.”

This year’s row follows the payment of £240,099 in bonuses and comes after a shareholder revolt last year over 2008 bonus payments.

Last year’s row was sparked when some shareholders became angry that performance targets had been changed retrospectively to enable the payment of bonuses.

In its annual report this year, Bellway said: “The committee has been very mindful of these concerns and undertook extensive consultations with institutional shareholders on future bonus arrangements in the spring of this year.”

As a result of the talks, Bellway reduced the maximum bonus figure from 120% to 100% of salary and based payments on fixed targets for operating profit (excluding writedowns), which accounts for 40% of the bonus. The rest will be based on cash generation targets (40%) and personal performance (20%), which will be evaluated by the remuneration committee.

This year John Watson, the chief executive, received a bonus of £104,391 on top of his salary of £515,000. The total, including pension, of £799,646 was down 3% on last year's figure of £824,917, which included a £275,000 bonus.

The payments are in contrast to Persimmon, Barratt and Redrow, none of which paid top bosses performance bonuses last year.