All aboard the cash express

PUBLISHED : Saturday, 04 March, 1995, 12:00am
UPDATED : Saturday, 04 March, 1995, 12:00am

NEXT time you are in London make a note of the Underground station names. Passing through Oxford Circus you might read the station signs as McDonalds, Knightsbridge might be Harrods, Marble Arch Selfridges.

London Underground, never short of an idea to raise its revenue (after all the walls of the Tube are famously plastered with advertisements) has come up with the idea of selling station names.

Hopefully it will not lead to such tastelessness as McDonalds at Oxford Circus but it is most likely to mean Lords at St John's Wood and Wembley Stadium substituted for the existing Wembley Park.

At a cost of around GBP1 million (HK$12.3 million) each station it may go some way towards helping London Underground find the GBP7.5 billion it needs over the next 10 years for improvements.

But isn't there something tacky about such remorseless commercialisation, the cheapening of some of our best known names? We are already well down that track with the ridiculous naming of sporting functions after products. We have the Martell Derby, the Cornhill Test and the Beefeater Boat Race. Logo louts one and all.

Watch commercial TV in Britain now and the weather forecast is sponsored by an insurance company and a TV crime series by a brewer.

Not that in commercialisation terms anything can beat the appalling bad taste of Britain's privatised utility bosses, this week shaking from yet another bruising in the Commons over their phenomenal salaries.

Not many people could hold it against an entrepreneur who builds up a company himself, out of his own skills and foresight, and then chooses to pay himself a high figure salary.

But if you are handed a public utility, usually a monopoly, on a plate then you might expect a degree of circumspection in the amount you or your 'remuneration committee' decide to pay you.

The issue has come to a head with even John Major turning against the fat cats of these new companies. David Jefferies, chairman of the National Grid, the power supply network, earns more than GBP2 million a year including salary and share bonuses.

Cedric Brown, the chief executive of British Gas appeared before the Commons recently to explain his 75 per cent pay rise to GBP475,000 a year - at a time when the industry was shedding jobs and freezing the pay of its lesser mortals.

Now it has been revealed that he is to reap a similar figure out of share options.

An authoritative report earlier this week revealed that the pay of directors of the privatised utilities bore little relationship to company performance in terms of either the stock market or profitability.

TONY Blair had hoped to make a killing over the issue. But the problem is that many Tory MPs are just as angry about it as Labour.

John Major took the wind out of Labour's sails by announcing that he plans changes in the law to ensure that executive pay and perks in these recently privatised utilities is justified by performance.

He cannot really legislate to stop pay rises, but what he can do is use the Companies Act to ensure that shareholders can vent their anger at them.

He wants to make clear that bonuses and share options should be firmly based on performance and not on 'windfall gains'.

This could involve stricter criteria for the price at which the shares were issued and the circumstances in which they were exercised.

It used to be that the unions held the nationalised giants to ransom with big wage claims hardly justified by their inefficient performance.

They brought down whole sections of British industry in the 70s helped by weak and timid managements. They brought Jim Callaghan's Labour Government to its knees in the famous 'Winter of Discontent' of 1979.

Now it is not the socialists, the unions but the so-called capitalists who are letting down the Tories.

The plutocrats are abusing their power, unfairly lining their pockets with cash which might have been passed on to the consumers in lower prices.