The perception that executive directors are paid too much for their roles at the top of publicly owned companies creeped into debate on Guernsey Posts’ yearly accounts.
Deputies unanimously approved the accounts for the States-owned organisation yesterday, which detailed the businesses financials between March 2021 and 2022.
In the period, Guernsey Post reported an operating profit of approximately £1.6m and returned £500,000 to the States of Guernsey.
This is amid the number of items handled by GPL falling, in line with the trends of previous years.
Deputy Peter Roffey, President of the States’ Trading Supervisory Board, which acts as shareholder of GPL, said the company had returned £20m to the States in the last decade.
Deputy Roffey added that a restructuring of the board in the accounts period had seen executive pay reduced, but he confirmed that discussions have been ongoing with all States companies to improve transparency with further details expected soon.
Pictured: Deputy Helyar called for clearer information into executive pay.
Policy & Resources’ treasury-lead, Deputy Mark Helyar accepted that non-executive director pay is not substantial but said: “With independent trading bodies where public money has been used, or monopolies are being enjoyed, I do think it would be good practice for the cost of the directors as a whole to be split out.
“I think all directors, including the executive directors of all trading entities, should have the amounts which they're paid, in terms of their salaries and their bonuses, set out so that the public can see what they have.”
Deputy David Mahoney, also a P&R member, queried why three line items relating to staff and costs in the accounts increased by around £2m between 2021 and 2022.
“The number of staff did go up slightly and I accept that. But not not anywhere near a 14% rise. So was that down to pay rises, or was that down to other matters,” he said.
Deputy Gavin St Pier also pointed out that GPL is a “very cash rich business” with over £11m on the balance sheet with no debt funding.
He labelled it a “very unusual position for a business of this size” within the postal industry, which does not reflect the commercial reality for similar companies.
He suggested that more cash could be distributed to the States.
Pictured: Deputy Roffey said improvements will be made to public accounting soon.
Deputy Roffey said GPL was in the process of acquiring HR Air and restructuring, and therefore holding onto the cash was “prudent”.
He said those efforts proved successful, and the business expects to be profitable in the medium term.
Deputy Roffey suggested that the public gets “supremely good value from NEDs” within its States trading entities. He also pointed out that the Chair of Aurigny makes just £15,000 per year, and others work for free.
On executive director remuneration, Deputy Roffey said it was important to pay market rates, set through benchmarking, to ensure good recruitment and suitable individuals.
The STSB has decided a “new way forward” to improve transparency around executives, Deputy Roffey added. He said it will not see each pay reward itemised, but bands of pay should be released within the coming months.
Express reported last year that the trading board was looking to improve transparency in public accounting after it was revealed that four executive directors at Guernsey Electricity were paid just over £1m in 2021.
Guernsey Post reported a multi-million-pound loss position at the end of 2022 and announced a desire to phase out 10% of full-time positions, as well as investment into fully automated sorting systems.
Since then, dozens of staff agreed to compulsory redundancy.
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