A politically toxic battle over the pounds 1.5m pay of Royal Mail boss Moya Greene looks likely to intensify as the government suggested it might block any large increases in executive remuneration. The move by Vince Cable's Department for Business comes after he previously objected to pounds 250,000 in relocation payments awarded to the recently privatised company's boss when the mail service was wholly owned by the state. Greene, who moved from Canada to take up the post, voluntarily agreed to repay the money after she heard of Cable's concerns. The issue of Greene's pay package has re-emerged since the government privatised 70% of the company in the autumn, triggering rumours that she will now be in line for a large pay rise. It will prove an early test of the new rules allowing shareholders to throw out over-generous executive remuneration policies - powers that were handed to investors by Cable. A spokesman for the Department for Business said: " Royal Mail has yet to put remuneration proposals to its shareholders, including the government, which remains the company's largest shareholder. We will of course discuss proposals with their remuneration committee to understand their thinking behind any changes. We have a vote at the annual general meeting and will exercise that vote." Royal Mail has pledged not to give Greene a large pay rise until after the current financial year, but the government's move follows Royal Mail chairman Donald Brydon telling the Daily Telegraph this week that Greene was the "lowest-paid chief executive in the FTSE 100" and a rise in her pay was necessary to keep her. "I'm not in the school that says top executive pay is without fault - there are parts of it that are egregious and wrong. But happily we are so far away from that end of it that to try and right-size her a bit I think is a necessary part of making sure we keep her." The government's comments come after the share offer was widely criticised for shortchanging taxpayers. Shares listed at 330p in October. They quickly soared and have maintained the levels Cable initially described as "froth" - closing last night at 600p.
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