Tasmania
Tasmanian Power Company Faces Criticism Over Large Payouts
Ross Burridge, operations executive at TasNetworks was given a $712,000 severance payment after his position was made redundant. Chair Roger Gill explained that executive benefits were tied to legacy deals following the Hydro Tasmania split century, which the company was required to honor. Over a three-year overhaul the company reduced the team from eight to five. The year executive Wayne Tucker received a $711,000 severance. TasNetworks confirmed Burridge was the executive under that contract arrangement. The company disbursed $22 million, in entitlements during workforce reduction from 1,250 to 1,100 employees.
TasNetworks says that legacy payments are behind the surge of six-figure termination payouts to executives. The public electricity distributor faced scrutiny this week over a $712,000 payment made to a departing executive. This occurred amid a company transformation. TasNetworks confirms that no executives remain on the legacy contracts.
Executive Received Over $712,000
A senior official at Tasmania's government-owned electricity distributor received compensation exceeding $712,000 when his position was declared redundant. However, he is probably the recipient of such a legacy benefit. TasNetworks faced inquiries regarding its entitlements during a government business enterprise hearing on Monday. Their annual report indicates that operations executive Ross Burridge was awarded $844,000 in termination payments, of which he received $712,000.
This encompassed a termination payment of $635,752 in accordance with the conditions of his contract. TasNetworks chair Roger Gill explained that the dismantling of Hydro Tasmania in the century led to several legacy agreements for executives. Mr Burridge was among those affected. These entitlements had limits. We were required to honour these agreements, he stated. We acknowledge that they are substantial.
Company Claims Individuals Assisted in Operating Power System
In fact, gaining the expertise of several of these individuals over the past 30 years has greatly assisted in managing the Tasmanian power system. TasNetworks reduced its team from eight to five during a transformation process undertaken in the last three years. Chief executive officer Sean McGoldrick mentioned that this led to the elimination of Mr Burridge's position.
Mr Burridge's departure following 40 years of service happened because of that, he explained. We restructured the business. His position became unnecessary, and currently, five executives report directly to me as chief executive. McGoldrick mentioned that a business case for the overhaul demonstrated that reducing the team's size would ultimately save the company money within a few years. This holds true even considering the severance payouts.
Top Officials Received Payments Earlier
TasNetworks verified that Mr Burridge was the executive under that kind of contract. In the financial year, executive Wayne Tucker received a $711,000 payout. Michael Ash obtained $269,000. Mike Paine received $380,000. The latest annual report indicated that another executive was granted $102,000 in termination payments following two years with TasNetworks.
McGoldrick mentioned that this payment served as a replacement for notice. However, the exit occurred due to a decision to leave for family-related reasons. It was not due to the job being made redundant. TasNetworks disbursed a total of $22 million in entitlements throughout its restructuring phase. During this period, its staff numbers were reduced from 1,250 to 1,100. The hearing was informed that sixty per cent of its employees are based in the field.
No Forced Redundancies According to the Company
Renee Anderson, the people and stakeholder executive, mentioned that no forced layoffs occurred. "We seek options for employees. Naturally, it is more challenging at this level due to the limited number of positions," she stated. "For anyone whose position was eliminated, if they wished to remain with the company, we proactively endeavoured to secure their redeployment or an appropriate role."
TasNetworks has not been the only publicly owned company in Tasmania to see a series of large severance payments to its executives. In the year 2023, Hydro Tasmania made public that five executives had been given $2.9 million in payouts over a period of two years. The amount included $475,000 for the outgoing chief executive, Evangelista Albertini. He left the company after only one year of serving in the position. He had been with Hydro for 20 years. As part of his remuneration, he received $197,000 as compensation for a six-month notice period.
The substantial payouts have sparked concerns regarding the management of agreements by public companies in Tasmania. Certain individuals believe the sums are excessive. They question the motives behind executives receiving large payments upon departure. Company officials explain that these contracts were agreed upon years ago. They were obligated to fulfil the terms. However, they also mention that new executives no longer receive contracts of this nature. The older contract formats have been discontinued. Executives leaving in the future will not obtain large payouts.
Read more business and public sector news at Inspirepreneur magazine. Get updates on executive compensation and government enterprise operations.