WaterAid to benefit from Scottish Water Chief Executive’s Incentive Payment for 2009/10
A percentage of the incentive payment due to Richard Ackroyd, the chief executive of one of Scotland’s biggest businesses as part of his pay agreement for 2009/10, will be donated by Scottish Water to charity.
Mr Ackroyd, who with his directors, runs a billion pound business employing around 9,000 people both in-house and through its capital programme, has decided that a share of his incentive payment should be donated by Scottish Water to WaterAid, the charity supported by the water industry in the UK.
Mr Ackroyd said: “I have looked carefully at all the circumstances and at how people are being affected by the consequences of the downturn in the economy.
“My priority as chief executive is to ensure that Scottish Water continues to deliver increasing value for money for our customers and that objective is even more vital in the current circumstances.
“While all Scottish Water staff must be properly rewarded for delivering outstanding performance Scottish Water will divert 25 per cent of any incentive payment due to me for our performance in 2009/10 to go to charity. The value of this will depend on the levels of performance achieved by Scottish Water at the end of the financial year. This will be assessed by the board of Scottish Water and paid in June 2010.”
The board of Scottish Water and the Scottish Government have been informed of the decision.
Mr Ackroyd believes that Scottish Water can do more to help our customers by delivering increasing value for money in its service.
He said: “We are determined to meet and beat our performance targets to deliver better value and service to customers.
“This is why Scottish Water is freezing its water charges for 2010/11, reducing its requirement for borrowing from the Scottish Government by over £40 million a year, while at the same time improving service to our customers and benefiting the environment.
“We are determined to do even better and deliver greater savings for customers and the Scottish Government. This is the context in which incentive payments have been made since Scottish Water was formed in 2002. The system of sustainable and long term targets backed by an incentive payment has been a success at Scottish Water.
“Scottish Water has cut the costs of running this utility by 40 per cent, ensuring stability in water and waste water bills while delivering the largest investment programme per household in the UK.”
Additional information
Scottish Water chief executive Richard Ackroyd’s basic salary is £263,000 a year. His potential earnings are lower than any other CEO of a water and sewerage company.
CEO salaries for 2008/09
| Company | Base Salary | Actual Bonus | Max Bonus |
| Water Companies | |||
| United Utilities | 777,200 | 471,400 | 130% |
| Severn Trent | 450,000 | 550,700 | 120% |
| South West Water (Pennon) | 315,000 | 186,000 | 100% |
| Northumbrian Water | 295,000 | 52,000 | 70% |
| Welsh Water | 260,000 | 131,600 | 100% |
| Scottish Water | 263,000 | 100,571 | 40% |
Incentive payments are a normal feature of pay packages in the UK water industry and have applied in Scottish Water since it was established in 2002.
The incentive potential of up to 40 per cent for the chief executive, Richard Ackroyd, is paid out only if the board of Scottish Water is satisfied that business targets have been outperformed based on confirmation from regulators.
His incentive payment in any year is subject to tax. On a reported incentive payment for 2008/09 he paid 41 per cent tax. This payment is non pensionable. In 2009/10 any incentive payment which will be paid in June 2010 will be taxed at more than 50 per cent under new tax rules.
In 2010-2015 Mr Ackroyd and his directors will be responsible for a £6 billion budget of which £5.3 billion will come from customer charges. This will include a £2.5 billion investment programme which will continue to improve the water industry in Scotland and which is expected to match Scottish Water against the best in the UK in 2015.
Our regulator described us as the fastest improving water company in the UK. We are determined to maintain that drive to succeed. Everyone at Scottish Water has a pride in our industry.
WaterAid
WaterAid works in 26 countries in Africa, Asia and the Pacific region transforming lives by improving access to safe water, hygiene and sanitation. WaterAid believes that these basic human rights underpin health, education and livelihoods, forming the first essential step in overcoming poverty.
Since WaterAid was established in 1981 it has reached 13.44 million people with safe water. Every year WaterAid now helps over one million people to access safe water and sanitation.
884 million people in the world do not have access to safe water. This is roughly one in eight of the world’s population
2.5 billion people in the world do not have access to adequate sanitation – that’s almost two fifths of the world’s population
1.4 million children die every year as a result of diseases caused by unclean water and poor sanitation – around 4,000 deaths a day
