As Barclays closes 172 branches, the boss stands to collect a ?30m bonus

Barclays was embroiled in fresh controversy last night with the revelation that its chief executive stands to earn £30m in bonus payments.

The disclosure of Matthew Barrett's performance pay package is certain to add to the outcry against the bank, which plans to axe 172 of its branches tomorrow.

The proposals have triggered unprecedented calls for a boycott of the bank by the environment minister, Chris Mullin.

Barclays admits that its shareholders have already attacked the bank's complex share options bonus scheme for senior managers.

And Pirc, a pensions and investment research company which advises fund managers on how to invest £250bn every year, intends to tell its clients to oppose the new bonus payment plan when they are asked for their approval at the bank's annual general meeting later this month.

Details of Barclays new bonus scheme were sent out to its shareholders last week.

Mr Barrett, whose annual income already exceeds £6m, joined Barclays as chief executive just seven months ago.

According to an analysis by Meis, an executive compensation company which conducts research for the National Association of Pension Funds, the terms of the complicated new bonus scheme means that top managers could receive options on shares worth up to 36 times their basic salary each year if they meet all the performance criteria.

This suggests that Mr Barrett, who is on a basic salary of £850,000, could be awarded options which would be worth £30.5m if Barclays meets its own targets.

Last night Barclays insisted that the complex terms of a new long-term incentive scheme for senior executives were being "misrepresented".

Peter Hawker, director of compensation and benefits at the bank, admitted that the intricacy of the plan had prompted questions from leading shareholders, but insisted that Barclays had no plans to rewrite the six page "incentive share option plan".

Alan MacDougall, managing director of Pirc, said that while he had yet to receive any comments on its recommendation from the bank, parts of the plan did not meet industry standards and in some instances were "insufficiently" stretching for top managers.

The scheme, which was sent to the bank's shareholders last week, has prompted the Association of British Insurers, the industry lobby group, to raise questions with Barclays about its structure.

Michael McKersie, manager of investment affairs at the ABI, while not endorsing the 36 times calculation, said: "Various points will need to be clarified to reach a full conclusion about the cost of the scheme.

"The potential awards appear high by UK standards and shareholders will want to ensure that the targets are genuinely demanding."

The terms of the reward scheme are complicated but allow for top executives to be awarded options worth a maximum of twice their salary and bonus. These are then allocated in two potential ways - one based on the "economic profit" of the group, the other on the way its shares relate to a peer group of 12.

While long-term performance schemes are common among major firms, and recommended by industry watchdogs, Barclays is also proposing to introduce a new way of valuing the options granted to executives - a system most commonly used in the US.

Mr Hawker disputed the calculations on a number of grounds, and insisted that it was impossible to value of the options because it would not be possible to know what the bank's share price would be worth in three years time, when the payouts would be calculated.

Salary experts say that the complicated new pay scheme, which Mr Barrett said earlier this year would see a "higher risk of no pay out", resembled pay deals which are more common in north America, the pay of senior managers is increasingly linked to the performance of the company.