British Gas horrified eight million hard-pressed customers yesterday, announcing an astonishing rise in energy prices. For thousands of people, an average £123 extra on their bills every year will leave them facing financial disaster, and there will be those left with a stark choice between heating and eating this winter.
So they will be particularly galled to hear that British Gas boss Chris Weston, will meanwhile be sitting pretty on a £2 million bonus.
SqueezeThe scale of the rises shocked many people. British Gas announced a 8.4% rise in gas prices and a 10.4% increase to electricity prices - dual fuel customers will see prices hiked 9.2%. The typical dual fuel customer will now see their energy bills top £1,444 a year.
Energy Secretary Edward Davey said: "This is extremely disappointing news for British Gas's customers, and the company will need to justify this decision openly and transparently."
The company tried to say it understood the frustrations of customers, and felt for them in these tough times. It blamed rising wholesale energy costs for the price rise. But for many people, the fact that British Gas parent company Centrica is making enormous profits exposes these as flimsy excuses. The company made £2.45 billion in profit last year, and is forecast to make £2.6 billion this year. Surely there was some wiggle room to give up some of these profits.
Fat catThe Managing Director of Centrica is Chris Weston, which makes him ultimately responsible for this decision. His basic pay packet is £595,000. However, according to the Daily Mirror, he also is entitled to a short-term bonus of up to £892,000 and a long-term bonus of £1.2 million.
The newspaper reported that when asked whether he would give up his bonuses as a gesture of sympathy with hard-pressed companies, he gave up the opportunity to demonstrate a determination to put customers first. Instead he said: "It is a matter for the board."
You could argue that he has no obligation to give up his bonus - it's something he's contractually entitled to and he has made a small fortune for shareholders. However, there are plenty of bosses who have done so in order to demonstrate that their intentions are good.
Better examplesThe boards of banks came under enormous pressure to do so after the financial crisis, and a number of bosses waived their bonuses. This set a real precedent for executives striving to win back the trust of their customers. Now many do so in response to a specific issue.
Back in February Barclays chief executive Anthony Jenkins said he would not be taking a bonus thought to be worth £1 million. He said that the bank had faced a number of difficulties of its own making, and that he accepted some responsibility for them. In those circumstances, he said it would be wrong for him to receive a bonus.
In July 2012 Ulster Bank CEO Jim Brown waived his bonus because of an IT glitch which had cut thousands of customers off from their funds.
And who can forget David James, who played a major part in rescuing the Millennium Dome from the prospect of failing before it opened, and waived his entire fee while he did so (which is usually £6,000 a day)?
In the greedy corporate world there are men and women who are willing to take a stand and put their money where their mouth is. It just appears that Weston is not one of them.