BARACK Obama&rsquo;s pay tsar is planning to slash the salaries of the top 25 executives at seven bailed out firms by a staggering average of 90 per cent. <br /><br />And total compensation for the 175 executives will fall by an average of 50 per cent, as the US Treasury Department&rsquo;s special master of compensationKenneth Feinberg cracks down on pay. <br /><br />The firms affected are Bank of America, Citigroup, AIG, General Motors, GMAC, Chrysler Group and Chrysler Finance.<br /><br />Feinberg will also demand a series of sweeping corporate governance reforms at the firms, such as forcing them to split the positions of chairman and chief executive. He will also tell directors to create risk assessment committees.<br /><br />And all executive perks over $25,000 &ndash; such as limousine services, private aircraft or memberships to country clubs &ndash; will have to be personally approved by Feinberg. <br /><br />It is currently unclear whether UK staff will be affected by the US-driven clampdown.<br /><br />Although the 175 executives will see their pay fall by an average of 50 per cent, this figure is skewed by a handful of particularly steep reductions, meaning some top earners will see much more modest reductions to their pay.<br /><br />Bank of America boss Ken Lewis has already agreed to give up his entire salary and bonus for 2009, for example.<br /><br />Some of the harshest pay restrictions will come at AIG. Top earners at its financial products unit &ndash; blamed for risky bets that threatened the stability of the giant insurer &ndash; will not receive more than $200,000 (&pound;125,000) each in total pay.<br /><br />AIG recently came under fire for paying out $165m in bonuses to its derivatives unit, after taxpayers pledged up to $180bn to keep the company afloat. Feinberg is now trying to convince AIG staff to return these bonuses.<br /><br />Meanwhile, Federal Deposit Insurance Chairman Sheila Bair said yesterday that all Wall Street firms should consider suspending big bonuses temporarily to appease public anger.<br /><br />Bair said that it was in the &ldquo;enlightened self-interest&rdquo; of large financial institutions to realign compensation to more &ldquo;normal&rdquo; levels.<br />