pounds 20m pay and perks for water bosses

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The Independent Online
The "shameless greed" of water company bosses was condemned by Labour's environment spokesman, Frank Dobson, yesterday, after he had exposed details of a new pounds 20m pay-and-perks package for the industry's directors.

The Labour analysis of the pay and perks awarded to 95 directors of 10 water companies values them at pounds 20,084,084, when the value of executive share options and new, long-term incentive plans are added to total salaries for 1995-96.

Away in the lead are the 18 directors of two companies, Southern and United Utilities, who share a total package worth almost pounds 7m.

Labour estimates that William Courtney, the executive chairman of Southern - who ceases to be a director at the end of the year, following the take- over of Southern by Scottish Power - is currently on a pay-and-perks package worth more than pounds 1m.

A valuation of pounds 954,905 is put on the pay and perks of Sir Desmond Pitcher, chairman of United Utilities, who is one of numerous water bosses to be put into a long-term incentive plan.

In Sir Desmond's case, the plan offers him the prospect of 87.5 per cent of basic salary - which works out at pounds 223,650 - on delivery of certain conditions. Sir Desmond is also on a short-term incentive plan, offering him a further annual payment of 40 per cent of basic salary, or pounds 102,240.

Mr Dobson said yesterday: "The water company bosses have no shame. After public criticism discredited the share options they awarded themselves previously, they've come up with a replacement - which gives them even more money.

"On top of the now customary high level of pay and perks, they are setting up a new scam - long-term incentive plans - to give themselves new bonuses if they hit targets they have set themselves."

The Labour frontbencher said that in most cases, targets were about financial performance and had little to do with customer satisfaction - and nothing whatsoever to do with the companies' pollution records.

Mr Dobson's calculations also excluded proposed long-term incentive plans that have not yet been introduced by Yorkshire and South West Water and, following the French takeover of Northumbrian Water, that company will not even disclose whether it has a bonus scheme at all.

"All this shows that the water industry, recklessly privatised by the Tory government, is going from bad to worse."

He said that not only were the industry bosses paying themselves more and more, but useful staff were being laid off, companies were making record profits and paying almost no tax because of the terms of the privatisation deal.

Companies were being fined for polluting the environment, the public was being pressured into accepting water meters - and ministers were programmed to defend all the excesses of the water industry leaders, Mr Dobson added.