Why did Newcastle Airport boss receive huge bonus?

Mar 28 2009 by Adrian Pearson, The Journal

DEMANDS were made last night for an investigation into how Newcastle Airport’s ex-chief executive was allowed to claim a bonus worth more than £2m.

John Parkin’s legal battle with Newcastle International has seen his original £6.3m payout reduced by £4m – but at a cost of around £2m.

Council bosses from across the North East, who between them own 51% of the airport, finally persuaded Mr Parkin to hand back some of his bonus in a last- minute deal which was kept secret until official accounts were released yesterday.

The former chief executive at Newcastle International had left his job with the huge bonus award for successfully refinancing the airport’s debt.

The same deal led to a multi-million pound payout for North East councils. But within months of the refinancing, Mr Parkin was suspended and legal action was launched by the airport to claw back the bonus.

Last night attention was turning on the council-packed remuneration committee which agreed the bonus in 2006, just months before he was suspended in 2007 for “certain contractual issues”.

Newcastle council leader John Shipley said the settlement raised serious questions for the Labour-dominated airport holding group, the body in which elected members oversee their interest in the business.

Mr Shipley said: “The public will rightly be concerned by this news, even though over £4.7m has been clawed back by the airport. There has been a review of governance arrangements and I understand the airport board will have these in place by May or June. To prevent this happening again it is essential that this is done.” North East minister and MP for Newcastle East and Wallsend Nick Brown called for an investigation into the matter.

He said: “This is completely unsatisfactory. Public money is at stake here and all the information should be put in the public domain.