Bank of England Governor Mervyn King enjoys 3% pay rise

By Hugh Pym
Chief economics correspondent, BBC News

image captionMr King is taking a pay freeze over the next two years

The Governor of the Bank of England, Mervyn King, saw his total pay package increase by 3% in the 2009/10 financial year.

His salary and health insurance benefits totalled £305,764 in the year to February 2010.

Current public sector pay deals are running at average rises of 1% per annum.

The Governor has said he will take a pay freeze over the next two years.

The pay details were revealed in the Bank's annual report, published on Wednesday.

Pay custom

The Governor's pay arrangements are agreed by the ruling Court of the Bank of England.

In 1999, the then Governor Eddie George decided - with the Court's approval - to accept a pay rise of no more than 2.5% annually. That custom is still in operation.

Mervyn King's salary was increased by 2.5% last year. Including the health benefits, the rise was 3%.

The Governor's salary is higher than the pay of leading civil servants, details of which were published on Tuesday.

The chief executive of the Office of Fair Trading John Fingleton topped that list with an annual package of £279,999.

Bank of England sources argue that the Bank is independent of Government and so is free to set its own pay rates.