How much does the prime minister get paid?

(Image credit: Getty Images/Justin Tallis)

published 7 October 2024

Prime minister Keir Starmer has been under the cosh for accepting freebies from party donors and others. In recent weeks it has emerged that Starmer has declared more free tickets and gifts than any other major party leader in recent times, with his total now topping £100,000 since early 2020. It is all perfectly legal, but it raises serious questions over his judgement. At the same time, the revelation that his chief of staff, Sue Gray, is being paid more than him, £170,000, lifted the lid on tensions at the heart of government (the suspicion is the story was leaked by aggrieved insiders). Together, the stories have dented the reputation of the government, but also raised the question: do we actually pay our PM enough?

How much does the prime minister get paid?

As of April 2024, the UK prime minister is entitled to a gross annual salary of £172,153. That consists of a basic salary for an MP of £91,346, plus a further £80,807 entitlement as PM. But, according to the BBC’s political editor, Chris Mason, Starmer, in fact, only takes a salary of £166,786 (so less than Gray). If accurate, that means he’s following the example of recent predecessors, including Rishi Sunak and Boris Johnson, in choosing to draw about £5,000 less than the full entitlement. In addition, the PM and his family get the use of a flat above the shop. It’s rent-free, but the PM has to pay a tax liability of about £7,000 a year for electricity, heating and maintenance. He and his family also have to pay for their own food and drink, even if prepared by the Downing Street kitchen. Similar arrangements govern the use of Chequers, the PM’s weekend retreat.

It’s not a small salary. Only one in 100 British taxpayers earn more than that per year. But it’s not even a remotely competitive salary compared with elsewhere in the higher echelons of the public sector – or even elsewhere in Whitehall. According to government data, some 664 senior government officials earned more than £150,000 last year, of whom 278 were being paid at least as much as the PM. And that’s just civil servants.

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In the public sector as a whole, many thousands of people earn far more. The director-general of the BBC is paid £525,000; the chief executive of Network Rail gets £585,000, for example. And it’s somewhat ironic that the journalist who broke the story about Gray’s pay – the BBC’s Chris Mason – is paid a lot more than either of them. In 2023-2024 he was paid about £260,000, according to the BBC. Not bad, but not as much as more experienced BBC political hacks such as Laura Kuenssberg (£325,000) and Nick Robinson (£345,000).

Compared with private-sector leaders, the PM’s pay is thin gruel. According to recent data from a High Pay Centre survey, the median pay for FTSE 100 chief executives last year was £4.19 million – the highest level on record, and up from £4.1 million the previous year. That’s 24 times the PM’s earnings. But even compared with other national leaders, Starmer’s pay is unimpressive. He’s not even the best-paid national leader in the nation he leads. Within the UK, the first minister of Scotland takes that prize, with a salary of £176,780. The Welsh first minister gets £148,575 and the leader of the Northern Irish assembly £123,500. The Irish taoiseach – leader of a state 13 times smaller than the UK by population – is paid €239,089 (roughly £200,000).

We pay our PM very modestly. According to a recent paper by consultancy Talent Insight, the UK is 29th out of 48 countries surveyed in terms of how much it rewards its head of government. We’re far behind the likes of the US, Germany and Japan (the US president gets $400,000, or about £300,000, plus another $50,000 allowance for expenses such as clothing). We’re marginally ahead of Turkey, Chile and the Netherlands. The striking outlier in the comparison charts is Singapore, which pays its chief executive Lawrence Wong about $1.7 million – but with very strict rules on what freebies politicians can accept. That’s a million dollars more than the next best paid leader, Hong Kong’s John Lee Ka-chiu. Other notably well-paid leaders (rankings vary with exchange rates) include those of Switzerland and Australia.

Yes, says Simon Kelner in the i newspaper. The Corrupt and Illegal Practices Act of 1883 was admirable, but it is strange that a 19th-century law aimed at stopping intimidation by landowners remains the framework for judging whether the PM should accept hospitality at Arsenal or let Waheed Alli pay for his specs. The current kerfuffle demeans the office – and we should start paying a basic salary more in line with the job’s importance.

The problem with money in British politics is that there’s just not enough of it, says The Economist. “Total political donations per year add up to roughly the cost of a competitive Senate race in America. A benevolent millionaire could fund almost all of Britain’s biggest political think tanks and have change left from £20 million.” Salaries are well below the market rate – for MPs, advisers and think-tank wonks – severely limiting the talent pool and making the cost of accepting them too high for many professionals.

Last year Labour advertised for a new head of economic policy, offering a £50,000 salary to help shape the direction of a £2 trillion economy. When salaries for MPs were first introduced in 1911, they were £400 a year, or roughly six times the full-time average wage. Now they earn just over double the average full-time wage. This “lack of money leaves much of politics the preserve of those who are rich, mad, thick or saintly. Sadly for Britain’s body politic, the saints are outnumbered by the rest.” If we want better politics, we need to pay for it.

Simon Wilson’s first career was in book publishing, as an economics editor at Routledge, and as a publisher of non-fiction at Random House, specialising in popular business and management books. While there, he published Customers.com, a bestselling classic of the early days of e-commerce, and The Money or Your Life: Reuniting Work and Joy, an inspirational book that helped inspire its publisher towards a post-corporate, portfolio life.

Since 2001, he has been a writer for MoneyWeek, a financial copywriter, and a long-time contributing editor at The Week. Simon also works as an actor and corporate trainer; current and past clients include investment banks, the Bank of England, the UK government, several Magic Circle law firms and all of the Big Four accountancy firms. He has a degree in languages (German and Spanish) and social and political sciences from the University of Cambridge.