Former Lothian Buses bosses collected £1m before stepping down

Ian Craig, former managing director, of Lothian Buses  Pic: Phil Wilkinson
Ian Craig, former managing director, of Lothian Buses Pic: Phil Wilkinson

BUS bosses who stepped down after falling out in a bitter row were handed a total of more than £1 million last year.

Three former Lothian Buses directors shared salary, bonus and pension contributions of almost £730,000 plus pay-offs totalling £389,000.

Lothian Buses and Transport for Edinburgh board.

engineering director Bill Devlin

Lothian Buses and Transport for Edinburgh board. engineering director Bill Devlin

And today there were calls for more transparency and accountability in the way the pay of the top executives is decided.

Former chief executive Ian Craig received a golden handshake of almost £89,000 when he left the company in January 2016 after a protracted row with three fellow directors. When salary and other benefits are added, Mr Craig’s remuneration for 2016-17 was £120,123.

Engineering director Bill Devlin and finance director Norman Strachan each received £150,000 golden handshakes when they left in January this year.

They also each received a bonus of £46,441.

Lothian Buses and Transport for Edinburgh board.

finance director Norman Strachan.

Lothian Buses and Transport for Edinburgh board. finance director Norman Strachan.

When their salaries and other benefits were added, Mr Devlin’s remuneration for 2016-17 totalled £355,103 and Mr Strachan’s £353,613.

Senior Labour councillor Gordon Munro said the huge sums contrasted with a bus driver’s annual pay of around £24,000.

He said: “Passengers, the public and politicians will be appalled.

“They will want to know how this decision was made, why it was made and how we can make it more transparent and accountable to prevent such largesse in the future.

“This is money that could be used to make bus services more effective rather than to enrich a few people.

“There are very few places where drivers can take comfort breaks.

“If the company can afford to pay directors these huge sums, they can afford to invest in the welfare of the workers.”

He said that although Lothian Buses was council-owned, no councillors were allowed to sit on the board.

Figures reported to councillors reveal pension contributions of £75,587 for Mr Devlin and £210,249 for Mr Strachan. This money is separate from remuneration.

The figures also show that, on retirement, Mr Devlin would be eligible for a lump sum of £83,000 and a pension of £49,000, while Mr Strachan would qualify for a £70,000 lump sum and a pension of £44,000. These payments are also separate from remuneration.

There are no figures in the report for operations director Bill Campbell, who left in March 2016 and did not receive any golden handshake.

Lothian Buses said payments made to the former directors when they left the company were based on legal advice following termination of their contracts.

It also said that in recognition of previous concerns, the Lothian Buses remuneration committee had developed policies which based salary and bonus levels on both individual and company performance.

Lothian Buses chairman Jim McFarlane said: “Lothian is a highly successful business that supports thousands of jobs and contributes millions of pounds to the city’s purse and is one of the highest rated for passenger satisfaction in the country. The two directors were instrumental in delivering a period of unprecedented success for Lothian and public transport in Edinburgh and Scotland during their tenure in post.

“Respected by their staff and industry peers, their vision and management have helped to create one of the UK’s leading transport operators.

“They have left behind an outstanding legacy for the city of Edinburgh and for the current management team to take forward.”

The city council said remuneration was an operational matter for the Lothian Buses board.

The ban on councillors sitting on the board is said to be due to a potential conflict of interest with transport-related council business.

A spokeswoman said Lothian Buses provided reliable journeys to millions of passengers every year.

She added: “Following a recent restructure, they have now streamlined their senior management team, almost halving the salaries bill and providing better value to the taxpayer for the award-winning service they provide.

“To continue with this success, it is vital that when they are recruiting, salaries are benchmarked against the rest of the industry to allow Lothian Buses to attract the highest calibre of candidates possible.”

ian.swanson@edinburghnews.com