Speaking at a hearing before MPs, the chief executive and co-founder Hayden Wood apologised for the “way things turned out with Bulb”.
“We have estimated that the costs of all these energy supplier failures is going to cost in excess £2.4bn. That is about £94 per household. And that does not include the cost of the failure of Bulb, which is being treated separately under the special administration regime.”
Are we all being taken for fools? – Owl
Boss of collapsed Bulb Energy criticised for £250,000 salary funded by taxpayers
Jane Clinton www.theguardian.com
The boss of collapsed company Bulb Energy has been criticised for continuing to draw a £250,000 salary, funded by UK taxpayers.
Once the seventh-biggest energy supplier, Bulb was effectively nationalised in November 2021 after collapsing amid the surge in global energy prices. That left the taxpayer with a potential bill of up to £3bn, making it the biggest state bailout since the collapse of the Royal Bank of Scotland in 2008.
Speaking at a hearing before MPs, the chief executive and co-founder Hayden Wood apologised for the “way things turned out with Bulb”. Bulb was placed into a rare “special administration”, giving it access to government funds to keep it supplying gas and electricity to its 1.7 million household customers.
Wood, who had provided management consultancy to the energy sector before he co-founded Bulb Energy, said: “My salary now in the last year is £250,000 a year.”
He added that the administrators for “both Bulb and Simple [Bulb’s parent company] asked me to stay on to help. The reason I stayed on was because we wanted to support customers [and] have a smooth transition into special administration.
“The things we are doing within the company is to try and minimise costs for consumers, minimise costs for taxpayers, and hopefully effect a sale of the company out of special administration to again reduce costs for government.”
However, the Labour MP Andy McDonald, a member of the business select committee, asked whether it was “morally justifiable” for taxpayers to be paying his £250,000 salary.
Wood responded: “I think everything we are doing right now is to try and complete a sale of the company so that we can minimise the cost to taxpayers and minimise the disruption to consumers.”
But McDonald said it was “staggering” that he was continuing to get paid “the same salary that you were pre-collapse”.
Wood said he had put “all his personal savings since 2015” into the company, which he founded in that same year with Amit Gudka. He said it had been an “extremely challenging time” for the energy market.
Charlotte Nichols, a Labour MP and committee member, quoted the former chief executive of Ofgem, Dermot Nolan, who said “for Bulb to blame anybody but themselves for its collapse is not reasonable”.
Wood said: “I completely agree. We at Bulb should take responsibility for how the business failed.”
He added: “Lessons will need to be learned and I hope that is what we can do.”
McDonald told the Guardian: “It is staggering that the chief executive of Bulb Energy continues to receive a salary of £250,000 a year at the taxpayers’ expense.
“There is no justification for Hayden Wood drawing such an enormous salary, particularly given the disastrous mismanagement of the company, which has led to the government bringing the company into public ownership, and is set to cost of the taxpayer as much as £3bn.
“The secretary of state for business, energy and industrial strategy must step in and put an end to this outrageous case of corporate welfare.”
A BEIS spokesperson said: “Bulb’s administrators have agreed to keep Mr Wood temporarily in place to ensure a smooth handover and sales process.
“Mr Wood is paid for this work under his employment contract with Simple Energy, the parent company of Bulb, in a separate administration process over which the government has no influence.
“The special administrator of Bulb remains legally obligated to keep costs of the administration process as low as possible. The government will seek to recoup costs at a later date, ensuring that we get maximum value for money for taxpayers.”