Lothian Buses boss gets 26% pay rise

Ian Craig was made chief executive of Lothian Buses under the expansion and given a bonus of some £80,000. Picture: Phil Wilkinson

Lothian Buses chief executive Ian Craig won the rise as part of the firm’s expansion to run the city’s trams, and extend its bus services into East Lothian and Midlothian.

The pay package included a basic salary of £183,000 plus a 40 per cent bonus of some £80,000 because both Mr Craig and the city-owned firm hit performance targets.

Mr Craig, who has been promoted from managing director as part of the expansion after six years in the post, was paid £211,000 in 2011. His pay is expected to remain largely unchanged this year.

The news prompted anger from the union for most of the company’s 2,000-strong workforce, but was met with approval by passenger watchdogs.

Council leaders said they would raise concern at the firm’s annual general meeting next week.

Unite Scottish secretary Pat Rafferty said: “The public sector would be enraged to hear of that sort of bonus being paid out.

“Lothian Buses is publicly owned and that salary would seem to be excessive when the most vulnerable in society are paying the price in austerity cuts and pay freezes.”

Council transport convener Lesley Hinds said: “The chief executive of the council will be raising our disquiet.

“We are looking closely at how Lothian Buses operate, as the council is the major shareholder and they are accountable to the public for their decisions.”

However, Bus Users Scotland said Mr Craig’s salary was a just reward for a job well done.

Edinburgh-based senior officer Gavin Booth said: “Lothian Buses is a hugely well-regarded company throughout the UK.

“It meets passengers’ aspirations, and satisfaction scores are very high. To hold on to someone of Ian Craig’s abilities, it’s important his remuneration is appropriate. He deserves the money he gets.”

Lothian Buses chairman Chris Walton said Mr Craig’s pay was based on the scale of his job and comparisons with similar firms. He stressed the company was a commercial operation competing in an open market.

He said comparing Mr Craig’s salary to that of the First Minister or the public sector was like “apples and pears”, with a more relevant comparison being other profit-making companies.

The salary details are included in Lothian Buses 2012 annual report, which showed net profits fell from £8.9 million to £8.2m, with passenger numbers unchanged at 111 million.

In the report, Mr Craig said trading had outperformed expectations, and profits from operations increased, despite a cut in Scottish Government funding, poor summer weather and “considerable disruption” from tram line construction.

Lothian Buses extended services in East Lothian and Midlothian after other operators scaled back. Mr Walton said the launch of the tram line, expected next year, would “cannibalise” bus passengers, but dividends to the council – some £3m last year – should cover any initial tram losses.

TOP EARNERS

RBS chairman Sir Philip Hampton £750,000+

Stagecoach chairman Sir Brian Souter £581,000

ScotRail MD Steve Montgomery £333,000

Lothian Buses MD Ian Craig £265,000

Edinburgh University principal Sir Timothy O’Shea £227,000

Police Scotland chief Stephen House £208,100

Edinburgh City Council chief Sue Bruce £158,553

First Minister Alex Salmond £135,605