Discretionary Share Option Schemes in the Privatised Utilities

Part of New clause 1 – in the House of Commons at 5:30 pm on 3rd April 1995.

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Photo of Mr Tim Smith Mr Tim Smith , Beaconsfield 5:30 pm, 3rd April 1995

Does the hon. Gentleman claim that the amounts that have been paid to these top bosses were agreed by the shareholders, and were subjected to proper scrutiny? They were not, and that is precisely why we want the powers and composition of remuneration committees to be strengthened.

The hon. Gentleman asked about the regulator. It is relevant to pull the regulator into the picture precisely because the top bosses of these firms should not be able to benefit to such an outrageous extent. That benefit is unrelated to their personal performance, or, in many cases, to the performance of the companies of which they are directors.

As everybody knows, the benefit derives primarily from what happens more generally in the market, and that is precisely what the public find so objectionable about these handouts. They also object to their scale, and to the fact that they arc unrelated to performance. They also find it objectionable that a few individuals get a benefit which is not available to the overwhelming majority of our people. No matter how hard they work, or how much they contribute to their companies, most people would never receive such benefits in a million years.