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Channel 4 chair defends pay rises for execs after slashing production budget

Channel 4 headquarters in Horseferry Road, London (Philip Toscano/PA)
Channel 4 headquarters in Horseferry Road, London (Philip Toscano/PA)

The chair of Channel 4 has defended handing out hefty pay rises at the same time the network was slashing production budgets amid the coronavirus pandemic.

Channel 4 chief executive Alex Mahon received total pay of £991,000 in 2020, up from £943,000 in 2019, while director of programmes Ian Katz had total pay of £536,000, up from £528,000.

Last year the channel announced plans to reduce its 2020 content budget by £150 million.

Chair Charles Gurassa told journalists they were given “maximum bonuses” as a result of their “stellar performance”.

He said: “The management did take a pay cut during the crisis, the top team did reduce their salary.

“But what you have seen this year is a stunning performance in the most extraordinary, volatile and difficult circumstances the media industry has ever experienced.

“If you just go back to those dark days of March, we were sitting there with the advertising market down 40%, with us not able to produce because of all the regulations that were in, so production was having to holt, we were broadcasting pictures of Army convoys taking bodies out of Italian hospital for secret burials.

“This team had to react with extraordinary agility, and with very fine judgment about getting it wrong. And they did that brilliantly.

“They put the brakes on costs. They focused on how can we keep the country informed, entertained, comforted, in this time of deep national distress.

“And as soon as the market started to improve, they took the foot off the brake and started to ease back into content.

“And as a result of that, at the end of the year, we’ve seen an extraordinary financial performance, probably the best, I think in the history of the channel.”

Explaining the company uses a variable pay system, he said the board decided the team had “shot the lights out” when meeting their objectives.

Citing an increase in audiences and digital growth, he added: “It was an absolutely stellar performance. So the pay that you see is a combination of their fixed pay, and of their variable pay.

“And we paid out a maximum bonus this year, which was richly deserved in the performance that was delivered.”

The channel’s annual report showed a record financial surplus, while Katz announced an additional £40 million will be added to the content budget across 2021 and 2022.

Mr Gurassa said: “We continue to see spectacular growth, both in digital and indeed in terms of revenue, which is allowing us to continue to put that money back, not just into content, but what the management team have to do is continually say, where is the best place for us to invest in the future?

“In a future where digital is increasingly at its heart, looking at the content, looking at the technology, and the marketing to support our digital activity is all part of that reinvestment programme.”

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