Accountants BDO to pay back millions in furlough cash after payout outcry
Accountants BDO will return £4.1m in furlough cash after being subject to a barrage of criticism for paying out hefty profits to its partners.
The Sunday Times reported that the company, which is one of the UK’s biggest accounting firms, would give back the money after paying its partners an average of £500,000.
Managing partner Paul Eagland said that the board had decided to hand back the taxpayer money after seeing the reaction to the payouts.
“I don’t want this to fester,” he said. “The money will go back to HMRC by Christmas.”
As a result, BDO’s 264 partners will each see their profit share cut by £15,500 on average, with more senior partners losing out on more.
BDO furloughed 700 of its staff – an eighth of its UK workforce – at the start of the pandemic.
The decision to pay back the money marks a considerable change of heart for BDO. Speaking to City A.M. last week, Eagland defended the decision to use the scheme.
Before the Open newsletter: Start your day with the City View podcast and key market data
“We sat down and thought about it very carefully. When we took the money it was absolutely dedicated to protecting jobs, and when people then say, ‘would you give that money back?’ We’re saying, ‘well look, it’s been spent on protecting jobs.’”, he said.
“It’s become quite a hot topic, and some people are quite passionate about it,” Eagland continued. “You either subscribe to the fact that if people earn big money they should pay the money back, or you subscribe to this being about protecting jobs.
“When the government works out how to balance its book, they will be coming to businesses and partners at BDO – we’ll be one of the first people in their firing line.”
Public companies have found themselves increasingly in the spotlight over the last couple of months, with boards having to decide what to do with taxpayer cash.
A number of supermarkets, led by Tesco, have pledged to give back a combined £2bn in business rates relief after a strong year for the sector, while others have elected to give back furlough cash.
But some, like construction firm Balfour Beatty and logistics group Wincanton, have elected to hold onto the cash while making payouts.