The outgoing chief executive of one of the UK’s biggest energy firms, SSE, was paid more than £2.60 million last year.
Ian Marchant, received the huge salary despite the firm being given a record find of £10.5 million by the regulator Ofgem for lying to potential new customers over the savings they could make by selecting certain energy tariffs from SSE.
In the aftermath, Mr Marchant refused to resign and it emerged that he was in line for a £15 million payoff if he waited until the summer.
SSE’s annual report revealed that Mr Marchant received £1.45 million in 2011. This year he received a basic salary of £870,000, an increase of £30,000. He also received shares worth more than £1 million from SSE’s long-term bonus plan on top of a pension worth £680,000.
The details of the long-term share incentive bonus, which makes up most of the increase, is that Mr Marchant received 51 per cent of the maximum that could be received under the Performance Share Plan for 2010-13. The increase is explained by the fact there was no comparable payout for the period 2009 – 2012.
As a result of the Ofgem decision, SSE reduced the other part of the bonus scheme, the annual incentive payment, which would have meant that executives qualified for 68 per cent of the maximum that could have been achieved, down to a maximum of 38 per cent.
Ian Marchant waived that part of his pay, whilst his deputy and likely successor, Alistair Phillips-Davies saw his annual bonus rise from £136,000 in 2011 to £210,000 in 2012.
SSE boss sees pay double to £2.6m despite Ofgem penalty