BEN VERWAAYEN, the chief executive of BT, earned £2.4 million last year, even though shares in the telecoms carrier underperformed the benchmark FTSE 100 by 12 per cent during the period.

The Dutch-born boss’s pay package included an £859,000 cash bonus, on top of his £700,000 basic salary. The cash bonus amounted to 122 per cent of his pay — just short of the 130 per cent maximum available for “truly exceptional performance”.

A spokesman for BT said: “Mr Verwaayen is a capable international businessman making a significant difference at BT.

“Our debt is down, our costs are under control, our cashflow is strong and customer satisfaction has significantly improved.”

Details of Mr Verwaayen’s pay were published yesterday in the company’s annual report.

The 52-year-old’s total pay was lower than last year’s £3 million because he received less in expenses and share-related bonuses.

The annual report also gives an indication of how well the company’s board believes its top managers are performing. Pierre Danon, the boss of BT Retail, the company’s customer-facing UK division, received a sharply reduced cash bonus following a year in which Retail turnover fell.

M Danon, who a year ago was considered the de facto number two to Mr Verwaayen, received a cash bonus of £259,000 out of total pay of £879,500.

His cash bonus amounted to 58 per cent of his basic pay — the smallest proportion paid to any of the company’s five executive directors.

M Danon’s “on-target” bonus would have been 50 per cent.

The biggest improvement was received by Andy Green, who runs BT’s recovering international and computer services businesses. His total pay increased to £959,000 from £914,000. His cash bonus of £336,000 amounted to 79 per cent of his basic salary of £425,000.

BT’s second biggest earner, and only other salary millionaire, was Ian Livingston, the finance director. He earned £1.07 million, compared with £1.28 million last year, including a cash bonus of £325,000, or 72 per cent of his basic pay.

The report covers the year to March 2004. A pound invested in BT a year earlier would be worth 112p at the end of the period, while an equivalent investment in the FTSE 100 would be worth 122p.