THE REMUNERATION of Independent News & Media’s chief executive Gavin O’Reilly rose by 18 per cent last year to €1.03 million.

INM’s 2010 annual report, published yesterday, shows that Mr O’Reilly was paid a basic salary of €751,000, benefits in kind of €26,000 and a pension payment of €259,000.

But he was not paid a performance-related bonus for 2010 in “view of the still uncertain economic outlook” and “the group’s focus on reducing all costs”.

Mr O’Reilly earned €877,000 in 2009, having succeeded his father, Sir Anthony O’Reilly, as head of the company in May of that year following a major restructuring of the media group.

Donal Buggy, INM’s chief financial officer, earned €647,000 last year compared with €903,000 in 2009.

His remuneration comprised a basic salary of €444,000, benefits in kind of €28,000 and a pension payment of €175,000.

INM’s two executive directors were paid €1.68 million last year. This compared with €5.33 million in 2009, when the company had five executive directors.

Non-executive directors were paid an aggregate of €585,000 in 2010 compared with €753,000 in the previous year.

INM has put in place a new short-term incentive plan for its executive directors that could earn them a bonus worth up to a maximum of 75 per cent of their basic salary.

This bonus plan is based on a certain operating profit target being met. A bonus of up to 50 per cent of basic salary is payable if this target is achieved.

Further increments are earned if the target is exceeded, up to a maximum of an additional 25 per cent should the operating profit be trumped by 10 per cent.

In addition, if the target operating profit is met, an additional bonus of up to 25 per cent of basic pay could be paid based on individual performance.

A long-term incentive plan has also been formulated for executive directors, subject to shareholder approval.

Starting in June 2011, this will involve share options being granted subject to certain earnings per share targets being met.