More than 97% of executive directors in FTSE 350 organisations have formal employer-sponsored pension arrangements in place, yet only one-third of UK private sector employees receive an employer-sponsored pension.

The report, Directors’ pensions: in it for themselves?, was compiled by Incomes Data Services for the High Pay Commission using the latest available data from annual reports and accounts, and drawing on data from the Office for National Statistics (ONS) and the National Association of Pension Funds (NAPF).

The report found that only almost one-quarter of mid-250 directors and one-third of FTSE 100 directors received a cash pension supplement, either as a standalone provision or in conjunction with other arrangements.

The report also found that, after filling up their pension pots, over one-third of FTSE 100 executives received pension supplements worth an average of £160,817, and mid-250 executives received an average of £121,500.

The average FTSE 100 lead executive with a final salary pension scheme could expect to receive an annual pension worth £174,963 on retirement.

Deborah Hargreaves, chair of the High Pay Commission, said: “Organisations have been busy cutting costs in recent years by slashing the pension provision for employees across the board.

“This has seen much of the private sector workforce shut out from the best final-salary related schemes, but the boardroom has shown no such restraint.

“As directors’ pay has risen exponentially, packages have become ever more complex and a part of these pay awards is an extremely generous pension allowance.

“The average FTSE 100 director has accumulated a pension worth £3.6 million, a sum that can only be dreamt of by an ordinary worker.”

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