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Centrica boss who said ‘no point’ justifying his salary sees pay nearly double

The boss of British Gas owner Centrica, who earlier this year said there is “no point” trying to justify his salary, saw his pay soar by close to £4 million last year.

Chris O’Shea was handed a £8.2 million pay packet in 2023, up from £4.5 million the year before, according to the company’s annual report released on Tuesday.

That includes a £810,000 salary, around £1.4 million in annual bonuses and £5.9 million in longer-term bonuses based on the company’s share price performance.

It was this latter part which has soared.

In 2022 Mr O’Shea’s long-term incentive plan payment was £2.3 million.

Labour party visit to Scottish Gas Academy
Mr O’Shea had earned £4.5 million in 2022 (Andrew Milligan/PA)

Around two thirds of that increase is a reward because the company’s shares have soared in value over the last three years.

The news comes two months after the chief executive said “you can’t justify a salary of that size” when quizzed by presenters on BBC Breakfast.

Speaking about his £4.5 million pay from the year before, he said: “It’s a huge amount of money, I am incredibly fortunate. I don’t set my own pay, that’s set by our remuneration committee.

“That’s the first bonus I’ve taken in my time at Centrica, for a number of years, I’ve given up bonuses because of hardships that customers were facing.”

The businessman has benefited from the spike in energy prices which helped drive up Centrica’s shares.

But his company has also pointed to the help it has provided customers through the energy crisis.

In the last two years it has committed to £140 million of voluntary support for its customers on top of £400 million through non-voluntary means.

Carol Arrowsmith, a board member who chairs the remuneration committee which sets the pay of Centrica’s top chiefs, said: “We need to ensure Centrica is set up for success in the long term and that means attracting and retaining high performing executives who can lead this large and complex business.

“Our CEO’s pay is based on the terms he was appointed on, the structure of the package was approved by our shareholders, and it is consistent with similar companies.

“Centrica’s performance and share price growth are the most significant factors that determine our CEO’s remuneration.

She added: “In addition, we have provided the largest ever package of voluntary support for customers in the sector, we have invested in gas storage to improve the energy security for the country, and we’ve set out our strategy to invest up to £4 billion over the coming years.”