Bureaucrats’ pay slips under the radar

The controversial subject of high CEO salaries at state government agencies appears to have gone off the boil as a policy to rein in remuneration appears to have helped stop surprise jumps in pay packets.

While the remuneration levels of the state’s top public servants continued to grow, with eight CEOs or equivalent paid more than $500,000 for the year ending June 30, compared to five in the previous corresponding period, the growth at the highest level has lacked the controversy of last year.

And, importantly, government trading enterprises no longer command all the leading salaries. Last year, Health Department acting director-general Kim Snowball was the highest-paid department head but the eighth highest-paid state executive.

In the past financial year, departments or bodies under department control held the third, fourth and fifth highest-paid state executives, led by Main Roads CEO Menno Henneveld, Mr Snowball and Transport Department director-general Reece Waldock, who were all paid more than $500,000. (Note: the figure for Mr Waldock was incorrectly overstated in the department annual report; the actual remuneration was $446,968).

Verve Energy CEO Shirley In’t Veld heads the list with $570,000 followed by LandCorp CEO Ross Holt on $547,000.

In part, politics was to blame for the controversy last year with bonuses paid to energy executives at the time of power price rises and a big jump in remuneration for the head of the state’s superannuation body GESB.

State government directives to agency boards to limit bonuses, where possible, are understood to have had an effect in some circumstances this year. 

But those are short-term fixes while the state government delivers on a promise to remove remuneration from control of government trading enterprise boards and make the Salaries and Allowances Tribunal responsible.

That move was a recommendation of the Economic Audit Committee report in 2009 and became a part of the political discourse last year amid the energy and GESB controversies but little has been heard about it this year.

Premier Colin Barnett insists the plan to bring in the tribunal – which is also becoming more responsible for local government CEO remuneration – remains on track. 

 “We are progressing amendments to the Salaries and Allowances Act, which it is planned will be introduced next year,” Mr Barnett said in response to inquiries from WA Business News.

Despite the reduced publicity around remuneration, energy chiefs remain among the most highly paid as the state continues to bear the brunt of political fallout caused by rising electricity prices.

In addition to topping the state remuneration list, Ms In’t Veld also earns additional income from her role as a non-executive director of national transport group Asciano. 

For the year to June 30, she earned $100,000, a figure that represents eight months on the Asciano board where the minimum payment for 12 months is $150,000. 

Furthermore, Ms In’t Veld has been appointed chair of Asciano’s newly created Board Sustainability Committee, which will attract a $25,000 fee for the current financial year, taking her total expected non-executive board remuneration to at least $175,000.

In pure pay terms this year, though, Ms In’t Veld was eclipsed by former GESB CEO Michele Dolin, whose remuneration of more than $1.3 million this year included a severance payment of one year’s salary and entitlements after she quit in May. 

Last year, Ms Dolin was paid about $515,000, a sum which generated considerable controversy given plans for GESB’s privatisation had been shelved.

Western Power’s CEO Doug Aberle has slipped down the ranks slightly. Mr Aberle was the second highest-paid state government agency or department CEO last year on $558,000, a figure boosted by a $92,000 short-term incentive. In 2009, Mr Aberle received a $94,000 short-term incentive payment but in the past financial year he did not receive any such bonus. 

In August, Governor Malcolm McCusker reappointed Mr Aberle as a director of Western Power for a two-year period.