The outspoken remarks by Sir Dennis Rooke in effect bury the dream of popular capitalism that was born with the creation of "Sid", the archetypal private investor invented to promote the sale of British Gas in 1986.
His comments are even more significant, coming on the day that the Government's controversial privatisation of the energy industry, which began with British Gas, is completed when shares in nuclear generator Births Energy begin trading on the London Stock Exchange.
Sir Dennis, who ran British Gas from 1976 to 1989, argues that the terms under which the company was sold to investors 10 years ago, including authorisation as the sole supplier of gas to domestic customers in Britain, have changed since privatisation, leaving shareholders feeling cheated.
"Over the years 'Sid' certainly has been conned ... There's not even been any real explanation," he says in a BBC television interview for tonight's Nine O'Clock News.
"What is happening is the kind of mess I thought we were going to get into. It happens to be much greater, and faster, than I'd expected."
Last night Labour's shadow energy minister, John Battle, joined in Sir Dennis' condemnation of the privatisation process.
"Investors are increasingly disillusioned," he said. "It is not quite the dream of shareholding democracy we were promised, and most shareholders have sold their shares to the institutions.
"There is dangerous evidence of the energy market unravelling and it is significant that Tim Eggar [the energy minister who is leaving Parliament] is walking away from it."
Sir Dennis' outburst comes at a highly sensitive time for British Gas. It is in the throes of breaking itself up into two separate companies and is locked in negotiations with the industry regulator Ofgas about proposals to impose price controls on its international pipeline business that could halve its profits.
It also faces the introduction of domestic competition in 1998. Rival suppliers can already ply for trade in south-west England, where half a million households can buy gas from a variety of companies.
So far about 10 per cent of customers have switched from British Gas to new suppliers.
Uncertainty about the future of British Gas has weighed heavily on its share price, and the Sids who bought in at 135p a share 10 years ago have had a poor return. Having reached a high of 350p two years ago, the shares now trade at 189p, a rise of just 40 per cent.
Over the same period, anyone buying the index of Britain's top 100 companies would easily have doubled their money by showing a capital return of 164 per cent.Reuse content