IMF, World Bank Chiefs Get 25% Raise; U.S. Objects

The International Monetary Fund and World Bank voted Thursday to hand their top executives controversial pay raises of more than 25% each to $285,000 per year, sources at the two organizations said.

The United States and Canada objected to the $60,000 increase as excessive but were overruled by other members of the IMF and World Bank boards in separate votes, they said.

Washington and Ottawa argued for a pay increase closer to the 16% rise in the cost of living since the last wage hike three years ago.

That would have translated to an annual salary of between $260,000 to $270,000.

Several sources said IMF Managing Director Michel Camdessus was the driving force behind the pay raise. Barber Conable, president of the World Bank, steps down at the end of this month and thus won’t be affected by the decision.

The sources said Camdessus wanted his pay to match that of Jacques Attali, another Frenchman who heads the European Bank for Reconstruction and Development in London. That bank, set up to aid Eastern Europe, began operations earlier this year.

The pay of IMF and World Bank staff is tax-free, except for U.S. citizens.

The sister organizations have the same 155-nation ownership, with the United States the largest stockholder. Traditionally, the fund is headed by a European, the bank by an American.

The bank is the largest source of development aid to Third World countries, lending about $24 billion a year and making a profit of about $1 billion. The fund provides money to help countries in financial trouble, also lending billions a year and making money on its operations.

Camdessus was overseas and unavailable for comment. An IMF spokesman declined comment.