The chief executive of Centrica received total take-home pay of £4.5mn last year, a more than fivefold increase on the previous year, despite a controversy surrounding its contractors’ treatment of vulnerable customers that has led to a regulatory overhaul of the instalment of prepaid gas meters.
Chris O’Shea’s pay packet has jumped from £875,000 in 2021, when he turned down his bonus to show solidarity with customers hit by the cost of living crisis, according to the group’s annual report. His pay in 2022 included a salary of £790,000, a bonus of £1.4mn and a long-term share award of £2.3mn.
But since then the group, which owns British Gas, has come under fire from fuel poverty campaigners after an investigation by The Times alleged that agents acting on its behalf had broken into vulnerable customers’ properties to fit more expensive prepayment meters.
British energy regulator Ofgem subsequently ordered all suppliers to pause the practice of forcibly installing prepayment meters and launched a probe into British Gas, which supplies electricity and gas to more than 7.5mn British homes.
O’Shea had been under pressure to waive his bonus again this year following an outcry about the allegations, which he called “deeply disturbing” in February, when he apologised and vowed to pause the practice until “at least” the end of the winter.
The backlash from activists and charities came despite operating profit at the retail division of British Gas falling 39 per cent to £72mn in 2022 as it made “voluntary donations” to help struggling customers.
Remuneration committee chair Carol Arrowsmith said O’Shea had shown “outstanding leadership, drive and determination to turn around the company for our 10mn customers, 20,000 colleagues and our many shareholders”.
The wider Centrica group posted a record £3.3bn operating profit in 2022 as its North Sea gas production, energy trading and nuclear power divisions benefited from soaring commodity prices in the wake of Russia’s full-scale invasion of Ukraine. The boost in earnings prompted it to extend a £250mn share buyback programme launched in November by a further £300mn this year.
Arrowsmith said bonuses for O’Shea and Centrica’s chief financial officer were justified given the group’s “exceptional” performance against targets. She said O’Shea had “performed exceptionally well” in the past year and that Centrica could not expect to “attract and retain leaders in the future” if it did not meet its commitment to recognise and reward the performance of its staff.
Centrica’s outgoing CFO, Kate Ringrose, took home a total pay of £1.1mn this year, including a £288,000 cash bonus. The previous year, she was paid a total £977,000 and accepted a £243,000 bonus.
O’Shea will also get a 2.6 per cent pay rise set to take his base salary to £815,000 from April. The group said it had offered an average base pay increase of 5 per cent to its wider workforce.
