The Poor Pay More

Following up an earlier post we see from the BBC that energy companies have been accused by an industry watchdog of exploiting some of the poorest people in society.

Customers with pre-payment meters are paying hundreds of pounds more for electricity and gas than those with access to the cheapest tariffs . Customers on the meters are charged an average of £195 more a year than those paying by direct debit . In some cases, customers using meters have been found to pay as much as £304 more a year. There are 3.5 million electricity and 2.2 million gas pre-payment meters in Britain. Some 580,000 pre-payment meters were installed in 2006. Energywatch claims that 63% were installed by companies to recover debts, which would limit the ability of those households to switch to cheaper suppliers or payment methods.

"That they should ramp up the rates and exploit those with no access to alternative payment methods is morally bankrupt," said Energywatch chief executive of Allan Asher.

According to Energywatch, the industry is making conservatively close to £300 million a year in revenues from customers on pre-payment meters.

Electric shocks

It is good to see that your electric bill went to good cause .

Scottish & Southern Energy , the Perth-based parent company of Scottish Hydro-Electric , has handed its top executives inflation-busting salary increases after a review of boardroom remuneration concluded that they were underpaid .
SSE's four executive directors saw their basic salaries rise by between 9% and 17%.

Chief executive Ian Marchant is now on a basic of £720,000 - an increase of around £100,000 in the past two years. Also proposed to the annual meeting was that the maximum bonus "cap" for executive directors under the company's new performance share plan be increased from 100% to 150% of salary.

Marchant's salary, annual bonus, and benefits jumped by more than 16% to £1.21 million in 2006-07, up from £1.04 million in the prior financial year. As well as his basic salary of £675,000, bonus of £518,000 and benefits of £17,000, Marchant was awarded 46,081 shares under the deferred bonus plan.These shares had a value of nearly £670,000 at last night's closing price . In all , taking his total remuneration for the year to nearly £1.9 million . Marchant also made a notional gain on the exercise of share options of £408,876.

Colin Hood, who joined the board of SSE in January 2001 as power systems director and became chief operating officer in October 2002, was paid salary, bonus and benefits totalling £894,000 in 2006-07, up from £772,000 last time. Hood was awarded 33,446 shares under the deferred bonus plan worth nearly £500,000 at yesterday's closing price

Finance director Gregor Alexander received £656,000 in 2006-07, up from £531,000 last time, including a basic salary of £360,000 and bonus of £282,000.

Alistair Phillips-Davies, the energy supply director, took home £659,000, up from £531,000.

Chairman Sir Robert Smith, meanwhile, saw his pay rise from £218,000 in 2005-06 to £266,000.

Next time you are told you are over-paid , remember what Scottish Hydro consider as under-paid.

meanwhile also reported by The Herald , the new Scottish Media Group chief executive Rob Woodward is set to be handed free shares in the troubled media group potentially worth £2.5million . A revamped long-term incentive plan (LTIP), which will be put to a shareholder vote at an extraordinary meeting on Friday, will see a clutch of executives share 2007 awards with a potential value of £6.8 million. Finance director George Watt, sole survivor of the much-criticised "ancien regime" at SMG, could pocket more than £900,000 when the 2007 LTIPs vest in three years' time.
Rewards not to compensate for being underpaid , but to "incentivise and motivational and retentative " purposes .