Prime Minister Kevin Rudd must show he's genuine about curbing executive salaries in the wake of the Productivity Commission's report on fat cat pay, Opposition Leader Tony Abbott says.
The federal government report into executive pay and bonuses proposes handing greater control of directors' salaries to shareholders, but has softened a key proposal to enforce accountability.
The commission's final report scales back plans to force directors to face immediate re-election if shareholders reject their salaries, Fairfax and News Ltd report.
News that makes sense
Your trusted source for staying up-to-date with the world around you. Get free daily news updates and analysis, straight to your inbox.
The report, to be released on Monday, proposes a range of measures, including preventing executives interfering with the committees that set their salaries.
But the so-called "two strikes" rule, which would have caused an automatic spill of a board after successive protests against their salaries by a quarter of shareholders, has been weakened.
Instead, the report says the votes against the board's remuneration report would trigger another vote that would require the support of a majority of shareholders.
Mr Abbott said he wasn't in favour of salary caps but said Mr Rudd must now show he's serious about the issue after commissioning the report.
He also called for proper shareholder control over executive pay.
"I'm not in favour of salary caps, but if Mr Rudd is fair dinkum about reining in executive salaries he's got to show it," Mr Abbott said.
"This is a matter for the government. Kevin Rudd declared war on executive salaries and now he's got to prove he means that.
"I think it's up to the government to show if it is fair dinkum about it."
