CEO of bloated outsourcing firm Capita quits after 26 years
Sailing back to private equity land with huge boat of cash
Fat cat chief exec Paul Pinder is to quit after 26 years at outsourcing giant Capita to head up small, private equity-backed businesses.
The man who, along with other top brass, pocketed a 20 per cent pay hike last year as IT Services staff had their wages frozen and bonuses shelved, is to be replaced by Capita deputy chief exec and joint COO Andy Parker at the end of February.
Capita was one of the four firms called out by the NAO this year for pocketing a collective £4bn in public spending and coughing just £81m in tax.
Pinder gained a reputation for being out of touch with his workforce: on top of last year's bumper pay rise, he caused uproar in 2010 when he told staff threatening to strike over a one per cent hourly pay rise to £6.42 that he was on £14k a week.
In a statement to the employees, Pinder said that when he steps down early next year he'll be approaching the company's 50th results presentation, and said that "now is the right time to hand over the reins to the next generation of senior management".
He may not have won over all his staffers - there were more than a few in the IT Services division who certainly complained about low morale in recent times - but like all corporate animals he kept the shareholders happy.
In that respect, the company which Private Eye nicknamed "Crapita" due to criticisms lobbed at its work on public sector contracts, keeps on growing, having made 13 acquisitions for £271m in calendar '13, and penned £2.9bn worth of new contracts to date with customers including the MoJ, DoECC and the Cabinet Office.
The firm is on track to grow revenues organically by eight per cent this year and group operating margins are holding steady, it said today.
Not all is rosy in the garden of Pinder: small parts of the Insurance and Benefits Services division are expected to post an operating loss of £15m for 2013. As such Capita has decided to sell its insurance distribution business for an undisclosed sum and close the SIP (self-invested pensions) unit.
No specific mention was made of the IT Services unit, which last year was the subject of bumbling restructuring, including a botched redundancy programme that caused the bad blood among some workers. And this year was said to still be under-performing.
Capita's board saw annual 2012 compensation rise by a roughly a fifth with total rewards for key management personnel leaping from £9.3m to £11.3m.
Pinder, who joined for investment firm 3i, signed off to staff today by praising staff, saying: "I would like to take this opportunity to deeply thank you all."
Pay remains frozen for around 70 per cent of Capita IT Services staff this year.
Capita confirmed that Pinder will "receive no payments for salary after his retirement". ®