Campaigners are calling on Centrica’s CEO to forego his £1.6 million bonus after the company’s ‘monster’ record earnings of £3.3 billion outraged them. Centrica owns British Gas.
Chris O’Shea, the chief executive, declined to talk about his bonus while defending his company’s tripling of earnings amid skyrocketing energy costs that have hurt families during the cost of living crisis.
Despite pressure from campaigners to reject it, the company’s CEO stated on Thursday that it is ‘too early to have a debate’ about his prospective large compensation.
Following a 2.5% raise, Mr O’Shea will get a salary of £794,000 per year for the previous year.
If Centrica meets the company’s long-term goals, he may also be entitled to a bonus of roughly £1.6 million.
Stop Fuel Poverty Coalition activist Simon Francis urged Mr O’Shea to ‘look at his conscience’ and that it ‘didn’t sit right’ for him to personally profit so greatly from the suffering caused by the energy crisis.
Given the shortcomings in British Gas highlighted in recent months, Mr Francis continued, ‘it cannot be stated that it has fully complied with its social obligations, and that should force management to rethink whether it is fair to receive bonuses this year.’
‘Chris O’Shea should forfeit his bonus, which is more than most people can hope to earn in a lifetime,’ said Ruth London, co-founder of Fuel Poverty Action.
The inability to heat their houses causes hundreds of deaths each year.
The size of Centrica’s revenues for the previous year has fueled resentment over a string of enormous gains made in the industry and strengthened calls for higher windfall taxes from opposition parties, unions, and environmental activists.
Ed Miliband, the shadow environment minister, attacked the administration while pledging that Labour will enact a ‘real’ windfall tax on energy corporations.
Paul Nowak, general secretary of the Trades Union Congress (TUC), claimed that the British energy market is dysfunctional and that ‘firms like Centrica are raking in monster profits,’ adding that privatisation has been ‘a disaster for hard-pressed people’ despite benefiting shareholders.
A windfall tax, according to Sana Yusuf, a climate campaigner for Friends of the Earth, should be enforced more strictly since it would help pay for ‘the investment in insulation and domestic renewables needed to drive down costs and decrease emissions.’
Yet according to Mr O’Shea, the income would enable the business to invest in renewable energy sources and cut costs.
On a call with reporters, he said, ‘Profits at Centrica have a purpose, and that goal is net zero, that purpose is helping customers have reduced bills going future.’
Regarding incentives, we’ve been a little more productive this year and we’re a little earlier in the process, Mr O’Shea said when asked about them.
Although it’s too soon to predict, the annual report will be released in March and will have all the information you want.
A £1.1 million incentive was provided to Mr O’Shea for the prior fiscal year, but he declined it.
The data also comes at a time when British Gas is under fire for using debt collection firms to forcibly install pricey pre-payment metres in the homes of vulnerable customers who are short on cash.
The controversy led the regulator Ofgem to launch an inquiry, and the company decided to stop requiring the usage of pre-payment metres.
This Monday, Gordon Brown advised Jonathan Brearley, the Ofgem CEO, to step down because he had failed to stop the crisis.
The majority of the populace agrees, according to a recent Savanta ComRes poll conducted for The Independent.
Just 3% of respondents said the Ofgem CEO should remain in his position, while 57% thought he should step down.
Also, the poll revealed that 47% of respondents want energy companies to be penalised and made to pay damages if it is discovered that they imposed prepayment metres on customers.
The majority of Centrica’s record earnings, which was made public on Thursday, came from its trading in energy and nuclear power.
British Gas Energy, which provides service to 7.5 million customers, had a 39% decline in profits to £72 million.
Also, the business made £1.4 billion in profit from its trading division, which makes predictions about energy prices, a startling 1,900% gain from the previous year.
Dr George Dibb of the IPPR think tank claimed that during a crisis in the cost of living, these earnings were being shifted away from bill-payers and directly to shareholders through dividends and buybacks.