Northumbrian pay up as profits tumble 10%

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The Independent Online
DAVID CRANSTON, chief executive of Northumbrian Water, received a 16 per cent pay rise last year despite a 10 per cent fall in the company's profits.

Northumbrian's annual report also revealed that Mike Guerin, a director who left after disagreements over strategy, received a pounds 184,000 payoff, including his company car. He was on a three- year rolling contract.

Remuneration for water industry executives has already caused controversy this year, though payoffs to former directors rather than the salaries of existing ones have caused most concern.

The company, the smallest of the privatised water utilities, said Mr Cranston's total remuneration rose from pounds 129,000 to pounds 150,000 because he took on additional responsibilities when the executive chairman was replaced by a non-executive chairman.

His basic pay went up pounds 23,000 to pounds 123,000, but because of the company's poor performance Mr Cranston was not awarded a bonus, which last year was pounds 8,000. Pension contributions and other benefits also rose by pounds 6m.

Severn Trent's former chairman, John Bellak, is getting pounds 500,000 compensation for early retirement and in lieu of pension contributions.

Bob Thian, the former North West Water chief executive who left after a management row, received a total payoff of pounds 400,000 and share options worth about pounds 276,000.

Northumbrian's profits fell from pounds 69.4m to pounds 62.8m, but the total dividend rose 8 per cent to 24.3p because it withdrew from loss-making non-core activities.