Placard-waving BT workers claimed that directors' pay had increased by more than 500 per cent since privatisation. This was seven to eight times greater than the pay increases for BT employees, they said.
Sir Iain's roasting, which came at the company's annual general meeting in Cardiff yesterday, followed the previous day's announcement that BT is making pounds 111 profit per second.
Sir Iain claimed the privatised company's policy already met all the main recommendations of the Greenbury Committee.
"Your company has not been a prime target of the general media criticism of executive pay in privatised companies. It doesn't even rate a mention in the Greenbury Report," he told the 866 shareholders attending the meeting. Sir Iain said the company did not seek to increase senior executive pay automatically and most increases this year had been around the 3 per cent mark in line with other BT managers and employees generally.
Despite the close questioning on pay, some of the greatest condemnation from small shareholders was reserved for BT's decision to reappoint Coopers & Lybrand as auditors.
Mark Hardy, responsible for most of the delay, tabled an amendment that in effect called for Coopers & Lybrand to be prevented from acting as auditors in future.
But Sir Iain defended Coopers & Lybrand as "doing a thoroughly professional job and giving value for money". Mr Hardy's amendment was narrowly defeated.
Earlier, Sir Iain had made a direct plea to the Government for less restrictive regulations to allow BT to compete more effectively abroad.
"Surely the time has come for the regulator to require our competitors, mostly backed by large foreign corporations, to stand on their own two feet without preferential treatment, provided at your expense."
Sir Iain said there had been competition in the UK telecommunications marketplace for over 10 years in what was acknowledged as the most open and competitive arena in the world.
"The regulator should surely balance his natural desire to generate competition in the UK with a responsibility to encourage national competitiveness.
"Sadly, but perhaps predictably, this crucial aspect of regulation did not even warrant a mention in Oftel's agenda for the next three years published earlier this week.
In a blunt speech Sir Iain told shareholders: "The glib assumption by some commentators that the UK regulatory system must have failed to date, because BT still holds a substantial overall market share, should cause you not just concern but indignation. This is not a measure of regulatory failure but of your company's success in providing its customers with what they want."
Denise McGuire, president of the white collar Society of Telecom Executives, who led yesterday's lobby by BT employees, said shareholders needed to be warned that BT's long-term prosperity and development was being put in jeopardy. Around 100,000 employees have left BT over the past five years.Reuse content