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Hayward to receive immediate £600,000 a year pension

Robert Peston | 19:23 UK time, Monday, 26 July 2010

Tony Hayward will be able to draw a pension of around £600,000 a year from the moment he leaves the company on October 1, I have learned.

This is his contractual entitlement under the company's pension scheme. The rules of the scheme say that those who joined it before April 6 2006 can take the pension at any point from age 50: Mr Hayward is 53.

However the pension entitlement is bound to be hugely controversial.

Mr Hayward's pension pot had a transfer value on 31 December 2009 of £10.8m, and he had accrued a pension of £584,000 a year. The pension pot will be worth more than that by the time of his departure.

The terms of Mr Hayward's departure from BP have been agreed by the company's board.

He will be succeeded by Bob Dudley as chief executive.

Mr Hayward is not being sacked but is leaving by mutual agreement, so the board feels it has to honour the terms of its contract with him.

He will therefore receive a year's salary plus benefits. That's worth more than £1m.

He retains a right to any bonus that's paid to senior executives this year, but bonuses won't be decided till the end of the year (by way of an aside, it would be slightly odd - to put it mildly - if any bonuses were paid for 2010, a year in which the company will declare a record loss).

And he will retain entitlement to shares under the long-term performance scheme, which - depending on BP's recovery over the coming years - could eventually be worth several million pounds

Mr Hayward is not severing his links with BP completely. He will become a non-executive member of BP's joint venture in Russia, TNK-BP (a part-time role) - largely because, I am told, his Russian contacts and knowledge are valuable.

UPDATE 0725: Hayward's circa £600,000 per annum pension turns out to be payable in 18 months, age 55.

For those who care, BP's own pensions website says that BP employees of Hayward's vintage can take their pensions at 50. And a senior BP executive, licensed to talk about these things, told me that Hayward's pension was payable to him immediately.

Today BP are saying that they got it wrong, that his pension will be paid when he is 55. They are amending their website.

Comments

  • Comment number 1.

    The amount of crap Hayward has had to put up with from the US, the US media and Obama, is virtually priceless; especially considering the involvement of Halliburton and Transocean have been largely ignored.

    But a near $1 million a year pension should be enough to annoy the US suitably. And I'm glad.

    David Cameron has shown virtually no backbone is standing up to the US on behalf of the UK over this, so this pension is the only thing we've got left to stick it to the US.

    A shame it wasn't $2 million a year, really.

  • Comment number 2.

    You could not write this and sell it in a book could you?
    And the story is not over yet by a long way. But then again the inevitable fraud that will occur in the states will be much more than the pension. And will any American firms involved get a hammering about the oil?

  • Comment number 3.

    I agree with Nick! I feel that we should be represented on the world stage by people who punch above their weight, not lightweights who grovel and refer to us as junior partners.

  • Comment number 4.

    Hold on a minute, a few weeks of crap and wanting one's life back is hardly justification for the diamond encrusted leaving do for Mr wayward Hayward. Before the analysts' keyboards have fallen silent on establishing the culpability for this disaster and not forgetting that eleven men died needlessly he is given enough that he does not have to work for the rest of his life. Yes BP alone is not responsible but surely must be the lead on accountability and perhaps there should be a claw back if his culpability is proven. I think this just reinforces the the governance of these massive multinationals must be underpinned by statute with the distinct possibility of jail if the fabulously paid have a carefree attitude to the human and ecological consequences of their responsibilities.

  • Comment number 5.

    Private businesses using private funds can do what they like in such matters and the stock holders can voice their opinions. This isn't like the banks falling back on public funds and paying out large retirements and bonuses. Big companies showing billions in profits on a quaterly basis can show these sums to be small when viewed in their overall income. This is no different than a ship captain running a ship aground..he will be replaced. The captain could have been asleep when it happened but that is who is replaced.

  • Comment number 6.

    If the business culture regarding Executive Pay expressly forbid the 'rewarding of failure', then would the result be:

    1) We would not have had or still not have a global financial crisis and a lack of strategic risk and operational management at BP?

    or

    2) The business world being paralysed with inertia as Executives had become unable to take decisions over or take on risk ... for the 'fear of failure'

    It seems that no one is frightened either of 'business' and/or 'personal failure' (at 'golden trough level') when it is not their own personal money at stake (albeit that they might have some personal shareholding in the companies that they are representing) ... and also because the operational side of the business can be fairly remote from the Boardroom ... in terms of 'blame'.

    One thing for sure ... no one should 'fear failure' at 'golden trough level' when 'golden handshakes' and 'golden parachutes' abound.

  • Comment number 7.

    I am with Nick, No.1 on this one.

  • Comment number 8.

    Disgusting, just like Fred the Shred, rewarded for massive failure.

    I was commenting on the blog yesterday regarding his exit and someone had the audacity to say the effects of this spill will be MINIMUM and BP had done such a good clean up effort it will all be sorted in a year.

    http://www.youtube.com/watch?v=cp2B2gIc-Ks

    That is some of the truth regarding BP's effort to clean up that they hadn't managed to censor. As CEO being rewarded 1 million a year he should carry the can, as well as the CEO's at TransOcean & Halliburton and none should receive a penny. Unfortunately, the elite who run these companies, like the banks, are above the law and wont be prosecuted like they deserve to be.

  • Comment number 9.

    I'm with Nick on this one 100%, could not have said it better myself.

  • Comment number 10.

    What happens to Hayward is irrelevant to the problem at hand. Frankly, if I have been with a company such as BP for 30 years I would expect my pension rights to be fulfilled. No one sees a past record of service and duty to a company, only possible mistakes, which may be subject to interpretation. While the results cannot be denied Hayward was not on the rig to know what DID happen. As all good commanders know, facts are difficult to obtain with reliability, thus delays are inevitable. The ensuing actions by all WILL clean up the mess and re-establish control, while new regulations should make research and drilling safer and more reliable.
    I say.....enjoy your new post and the pension Hayward.....you are still young and can use your knowledge and experience, and the lessons learned, wisely. The situation needs a scapegoat....you are it. Field Marshall Montgomery was penalised for a misdemeaner when a young lieutenant...look what happened to him!

  • Comment number 11.

    I completely agree with Nick. Speaking as somebody who works in the industry, I was particularly annoyed by the performance of the other CEOs of the majors before the senate especially their hypocrisy. The facts of the matter are - all the companies follow the same procedures in the GOM ( Gulf of Mexico), BP got caught that's all. Hayward has been hung out to dry.

  • Comment number 12.

    Wasn't there the loss of 11 lives, as well as the worst ecological disaster any country has faced on it's shores? The question I ask myself- is it reasonable that the man in charge should walk away with £1million plus £600k pension?

  • Comment number 13.

    how can Tony Hayward get a 600 grand pay off and still be employed at B.P. ?

  • Comment number 14.

    SHOCK HORROR!

    Greasy pole climber slips all the way down to the bottom (npi)!

    - 11 people died
    - Worst ecological disaster in history

    Free-market libertarian walks away with £12 million pension.

    Poor guy!

    Move along now please, move along...nothing to see here!

  • Comment number 15.

    CEO, who worshipped previous CEO's cost cutting expertise and ability to satifsy short term shareholder greed gets sacked (with huge pension)!

    NEXT PLEASE!

  • Comment number 16.

    £600k pension a year from aged 53. I am guessing this is index linked though I may be wrong. If it is index linked, then a 53 year old male pension pot of the annual sum divided by 0.03 is needed, which equates to £20M.

    Clearly politics had a part to play in this matter, however if the CEO is paid gargantuan amounts, then he or she can carry the can if matters go significantly awry.

    To pick up on the point about how stockholders can always express their disapproval with the package or pension for failed senior management. It does not work.

    The ultimate stockholders are your and my small pension and ISA holdings.

    The agents and managers of our pensions are the institutional shareholders. Occasionally they bluster a bit to play to their public about the shocking remuneration or pension of senior management of large PLCs.

    The reality is that in 99.9% of cases, nothing ever comes of this bluster, very occasionally they will remove a chief exec.

    The institutional shareholders do not want to rock the boat, because many of them also receive very significant similarly structured remuneration and pension packages, mix in the same circles, have vested interests and if they shout too loudly, the press will be quickly onto their own remuneration.

    Those that would rock the boat, the millions of individual pension and ISA shareholders, often heard through the lone voice of a dissenting individual shareholder at the AGM, are completely powerless in a situation that has gone on for years and will go on for years.

    These packages would not happen in a family owned private company because the shareholders are the ones that also wield the power.

  • Comment number 17.

    What would the payout have been had he been a moderate failure instead of a total disaster? Stennylfc is correct - he is no different to Fred the Shred.

  • Comment number 18.

    Pablo: Hayward has been hung out to dry.

    If this is being hung out to dry, can I volunteer? Surely, if he *has* to go, it is a reflection on his performance. In which case, shouldn't a pay-off be limited?

  • Comment number 19.

    10. At 8:46pm on 26 Jul 2010, Ketomato wrote:
    "What happens to Hayward is irrelevant to the problem at hand.... Hayward was not on the rig..."

    Well, now lets see, if the man in charge is not responsible, then how about his direct report? Or how about the chap who reports to him, should he be able to walk away with a big pay off & handsome pension? Not them, no they weren't on the rig either, well what about their direct reports, should they be able to walk away?... Until we get to the 11 people who were on the platform... Oh, but wait a minute, they can't walk away can they?

    You see, if the man in charge is not responsible, then who is?

  • Comment number 20.

    I also agree with #1 Nick.
    There should be no rewards for failure, but Mr Hayward has not failed. He was not personally culpable for the accident or the deaths it caused or the oil spill. He had by all accounts sought to emphasise safety more strongly after the demise of Lord Browne as CEO, but however strongly he may have tried to change the culture, it could not guarantee that everyone would mend their ways totally or that accidents would cease to happen.
    It is right that he should go because BP would suffer much worse continuing reputational damage if there were seen to be no change of top management, but it is also right that he should receive a good pay-off in the circumstances.
    Although the oil spill is a major short term catastrophe for the region, the worst of the effects are unlikely to be long-lasting, unlike some other self-inflicted ecological catastrophes in the USA (eg prairie dust-bowls, land salination from diverted rivers used for irrigation schemes, Detroit,...)
    USA should just be grateful that the cost fell on a company with deep pockets like BP, not on a fly-by-night oil exploration company that would have folded long before paying $20bn compensation. Next time, oil majors will probably have more sense than to undertake risky deep water exploration in their own name.

  • Comment number 21.

    "If this is being hung out to dry, can I volunteer?"

    You want to be the most hated person in America? You want death threats sent to you? You want to be publicly humiliated by the US President looking to save his own skin, the US media and the US Senate?

    I can't even begin to imagine the pressure Hayward and his family have been under. All he, his wife and kids have to do is to put his name into Google to read...well, you can see for yourself.

    Pablo is absolutely right. The other CEO's at the Senate were extraordinary in their hypocrisy, although one shouldn't have expected anything less.

    I found it particularly amusing when a Senate member told Hayward something along the lines of "Shell and Chevron (I think) said they would not do the type of deep sea drilling as BP".

    Really?! Who'd have thought that? Hayward, and by extension the UK, have been made been taken for an absolute ride, once again, to appease the USA.

    BP gets a US CEO, BP assets get sold to a US company, BP gives $20 billion to US (at the expense of dividend payments), where someone would be absolutely foolish to believe that that money is all going on the spill; who knows where that $20 billion will end up.

    The UK is a laughing stock...*again*.

  • Comment number 22.

    The fact is Tony Hayward hasn't handled this well from the start. To be fair he tried to show leadership by being the man on location but with his PR gaffes and failure to stand up to US administration it has back fired spectacularly. However he has given over two decades of service to BP.

    As for the pension BP operate a final salary pension scheme for all employees (2/3 final salary) and with TH being with BP for 28 years this is in no way out of line with every other employees scheme. He will have contributed to this pension every month and built it up over the last 28 years, its not some windfall they have just handed out to him. The only thing that can be queried is the fact he can draw it immediately. Usually a resigning employee has to defer this until pension age.

  • Comment number 23.

    When will it be...when we hear the word ENTREPRENEUR...we associate that person as being a quick-buck-merchant who just wants to burn the world's precious resources (as fast as is possible), just for their own short term gain?

  • Comment number 24.

    Hands up - ho many of us who resign 'by mutual consent' would get a whole year worth of salary?

  • Comment number 25.

    So we move into a period of austerity where everyone in the private and public sector can look forward to.... severe austerity, that is of course everyone except...

    I put this concept up on another blog over the weekend. Remuneration packages for all have to be reviewed, from the disgraceful lower end pittance to the gross top end indulgences. This isnt market forces at play, its the manipulation of markets for pure self interest.

    We elect Governments to protect the majority from this sort of abuse, its time Government faced up to their responsibilities and reviewed the meaning of the word 'fair'. This release package is far from that.

    This type of package has of course now become the norm, it is quite straightforward really, the top execs just do not warrant or deserve these lottery wins as remuneration. Something must be done!

  • Comment number 26.

    "This type of package has of course now become the norm, it is quite straightforward really, the top execs just do not warrant or deserve these lottery wins as remuneration. Something must be done!"

    Like what? Ban capitalism maybe? This is a PLC, its got absolutely nothing to do with the government who gets paid what. BP is a money making machine and doesnt need hand outs from the government to stay afloat.

    The shareholders have the final say not the nanny state.

  • Comment number 27.

    I don't think it is any of our business what Tony Hayward's pension is. He is a successful businessman who is rightly rewarded for leading one of Britain's most successful businesses. He's been removed so that BP can suck up to the Americans. BP must pay him what he's worth and he's definitely worth his pension.

  • Comment number 28.

    Can someone explain how he can receive his pension at age 53 when the minimum retirement age for a pension went up from 50 to 55 in April 2010?

  • Comment number 29.

    The record of Mr Hayward as of 19.04.2010 has been acknowledged to be outstanding and remains widely appreciated, if now overshadowed. On the 20.04.2010, it would appear, an accident happened.
    The BBC has reported that since 20.04.2010 Mr Hayward has been 'widely criticized.' I cannot entirely agree. I know of little criticism from outside the US, and from within the US the criticism has tended to stem from unpopular politicians doubtless concerned about re-election. Following the President's extraordinary declaration of war on Mr Hayward, the pertinence of the remark, 'The first victim in war is truth,' has become evident.
    Does the President not know that when sacking someone due process is to be followed? When investigations into causes are incomplete, how can the Senator talk of stonewalling? Is not 'getting the job done' in order to 'return to one's loved ones as soon as possible' a core US value? And unpalatable though it may sound at present, what if 'the Gulf of Mexico is big,' and the expectation that nature's power to heal will prevail proves reasonable?
    I am aware of three major BP accidents: 1) the Alaska pipeline 2001, 2) the Texas refinery 2005, and 3) the Deepwater Horizon rig and spill. These are all in the US, and the conservative approach of BP elsewhere has been documented on this site, just as the priority given to profit at Amoco, now BP America. Is there a question of BP culture, or of US culture?
    Further, doesn't demonizing Mr Haward say more about US Americans than the man himself? And, since Mr Dudley is a former Amoco man and the BP board member responsible for the US, can he be the man to sort out the problem?
    Having suffered the above, I would say the settlement is reasonable, and I trust Mr Hayward continues to earn well in his new job.


  • Comment number 30.

    Nick:

    Hayward, and by extension the UK, have been made been taken for an absolute ride, once again, to appease the USA.

    BP gets a US CEO, BP assets get sold to a US company, BP gives $20 billion to US (at the expense of dividend payments), where someone would be absolutely foolish to believe that that money is all going on the spill; who knows where that $20 billion will end up.

    The UK is a laughing stock...*again*.


    I think being a laughing stock may come from paying somebody vast amounts when they mess up. Put simply: it happened on his watch. His handling of the aftermath was poor, to put it mildly. Crying all the way to the bank, it appears.

  • Comment number 31.

    Instead of waiting until these jokers lose their jobs, when shock-horror! having been paid a huge salary they are entitled to a huge pension, why not ask some questions NOW about why this class of person gets paid so much. Believe me, most of them aren't very good at what they do, except the one thing they do really well- persuading others in the same class that they should be paid loads of money. Their "talents" begin and end there. Sorry folks, but that is how capitalism works at the highest level. Don't complain at pension time- just look at what they are drawing now- and for what.

  • Comment number 32.

    He cannot receive his pension before age 55 no matter what Rules say.Legislation was altered on the 1 April 2010.

  • Comment number 33.

    Hayward has brought BP and the entire industry into disrepute and it is impacting even here in the N Sea where the EU is looking at banning all drilling in the UK.

    The man should be slung out on his ear along with BP's chairman and all the non exec directors who have shown themselves to be completely useless.




  • Comment number 34.

    26.

    I'm talking more of the model used for remuneration. It really is a central role of Government, perhaps you are advocating no Government at all to allow capitalism to reign in its finest form?

    Lottery win style remuneration packages for individuals are totally unjustifiable.

    The shareholders say has already been well covered on this blog.

  • Comment number 35.

    stop being jealous.he was head of multi national company.£600k isnt too large.how much are the news readers on for reading a auto cue...we all cant earn same.as for spill it was a contractor who caused it and as for bp meaning british it isnt.noticed america didnt mention there involved.but as for money issues about time people stopped knocking so called big pensions they earned them.all part of conditions of employment.so good luck to him and hes earned it whetehr you agree or not.

  • Comment number 36.

    How ironic the BBC thinks large payoffs for executives are newsworthy. eg Tony Haywood

    This from an organisation that has numerous managers on 100k plus salaries and generous pension pots.

    BBC news do not think council executive or headteacher payoffs are in need of such scrutiny?

    Public sector payoffs OK - private sector payoffs naughty?

  • Comment number 37.

    On one hand, its another example of the disgraceful routine greed that drives compensation in many businesses. It really is not just bankers and footballers, its widespread. On the other hand, most of the reasons for him being forced out are about his media handling gaffs. Yes they were truly awful, but he is not paid to be a media commentator. How effective has the engineering recovery programme been? Could any other oil company have responded more effectively? I don't know, but surely that should be the measure. Finally, I thought you could not retire (i.e. draw pension) till you were 55 years old in the UK, as of April 2010?? How can he draw a pension at 53?

  • Comment number 38.

    Did the legal lower age limit for starting to take a pension not increase from 50 to 55 on 6 April 2010?

    see: http://www.hmrc.gov.uk/pensionschemes/min-pen-age.pdf

  • Comment number 39.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 40.

    Yet another example of legalised theft from our pension funds, which are the major shareholders in PLCs.

    Senior management remuneration quadrupled in 10 years - shares prices (i.e. our pension values) down over the same period.

    But then why should these people work too hard for the shareholders (our pension funds) when, if they foul up, they end up taking their ill-gotten gains with them, courtesy of the greedy fund managers who are supposed to safeguard pension fund interests, but in reality are helping themselves to their slice of the pension fund cake irrespective of their own atrocious performance.

    Who's to stop this gravy train? - not the government it would seem - not when so many former government ministers end up with lucrative positions/consultancies in these companies.

    No wonder final salary schemes have all but disappeared in the private sector (except for the likes of Hayward of course).

  • Comment number 41.

    For me this was always about an attempt to grab BP America. In the late nineties the BP - Amoco deal was billed as a merger. The ink on the deal had hardly had time to dry before the Amoco name was dropped from BP Amoco and the whole US side was re-branded BP. The US administration have never forgiven BP for this back door 'take over'.

    To add insult to injury BP then went ahead and built up a portfolio of world class assets in the Gulf, becoming the largest producer and the only super-major replacing their reserves year on year.

    What a great opportunity it has been for some fierce BP bashing and a blatant play for the sale of BP America with Exxon or Chevron mooted. Fortunately BP have enough 'fringe' assets they have sold to shore up the fund without gifting the US their ultimate goal.

  • Comment number 42.

    If a banker made this Pension people would be outraged. Well I for one am thrilled for Tony Hayward. Not only has his own board made him a scapegoat, but I imagine the Americans will be outraged by this payment. And I really hope they are. Transocean have escaped ridiculously unscathed which is a farce. Obama and co. have got what they wanted, but BP as a company will rise again, and I wish Mr Hayward all the best for his retirement.

  • Comment number 43.

    Sad to see the amount of witch hunt going on. We all know what a witch hunt is, and those who who were doing it historically did not know it is wrong (at least the public didn't). They believed in it. It is just a panicky reaction combined with mass hysteria and without having good reason.
    Let's look at the facts:
    - He deserved almost this pension three years ago. It is the accumulated result of a long time job.
    - We don't know if he is personally culpable or not. If I were in his shoes I would certainly prefer indictment and having my day in court to all the hate going around.
    - The idea that a CEO is only motivated by money is something I don't accept. Money is important, but professionalism is usually an important factor too. The idea that somebody wants to be the biggest failure ever is unpalatable.
    - It got mixed up in politics. The good Obama needed a scapegoat. And nobody would stand for a British citizen in such a case (see Nick, #1).

    Fred the Shred is a different case. He didn't acknowledge the problem and there was a lot of dishonesty in the banking sector. I don't see the oil sector as being of such a low standard.

    If this continues, I think CEOs should do less to now work. The job of a CEO would be redefined to be someone who does nothing and gets a lot of money, until a crises happens and then he or she should face a firing squad. In particular, the misquote "anyone who is capable of getting themselves made CEO should on no account be allowed to do the job" would be very representative of that post.

    Disclaimer: While I have nothing to do with the oil industry, I am an engineer and would like the industry sector to be spared such witch hunts.

  • Comment number 44.

    "For me this was always about an attempt to grab BP America."

    Comment of the thread. Absolutely spot on.

  • Comment number 45.

    BP and Tony Hayward accepted from the beginning that as Operator it was BP's obligation to shut off the subsea oil flow and deal with all aspects of the pollution caused.I believe that BP have and are continuing to honour that obligation.
    Accepting that obligation does not mean that BP have accepted responsibility for the actual blow out and it's tragic consequences. A full investigation of what caused the blow out has yet to be initiated, and the jury is likely to be out on this matter for some time to come.
    Meanwhile the US public have interpreted BP's actions as an admission of guilt for causing the accident. Why would they not when BP's US partners, who under a joint venture agreement should be obligated to take joint responsibility for the consequences of the oil spill, have refused to participate in the cleanup, and are attempting to back out of the deal by accusing BP of gross negligence. BP do not appear to be beating on their doors and the US public see this only as BP accepting all the blame.
    BP's name stinks in the US because various political and commercial interests have for a number of reasons employed superior PR skills to spin their stories. Every day sees a new slant in which BP is villified.
    The US public has little respect for good guys who roll over. BP's initial public relations response was misguided and pathetic, and BP is now paying the price even though we still do not know who is to blame for the blowout.

  • Comment number 46.

    From wiki:
    'Anthony Bryan "Tony" Hayward (born 21 May 1957) is the Chief Executive of oil and energy company BP Group, having taken over from John Browne, Baron Browne of Madingley on 1 May 2007.'


    From the telegraph '“It is matter of public record that in late 2007 BP told the UK Government that we were concerned about the slow progress that was being made in concluding a prisoner transfer agreement with Libya,” the company said in a statement.', here: http://www.telegraph.co.uk/finance/newsbysector/energy/oilandgas/7892112/BP-admits-lobbying-UK-over-Libya-prisoner-transfer-scheme-but-not-Lockerbie-bomber.html

    Further, from the info, this time from the Times: 'On December 19, 2007, Straw wrote to MacAskill announcing that the UK government was abandoning its attempt to exclude Megrahi from the prisoner transfer agreement, citing the national interest. '

    http://www.timesonline.co.uk/tol/news/politics/article6814939.ece

    Johann Hari puts it all together here:
    And from the Independent just three days ago:

    http://johannhari.com//2010/07/23/tony-blair-plotted-to-free-a-terrorist-in-exchange-for-oil-does-this-reveal-something-crucial-about-iraq

    It started before Hayward during the time of Blair, continued on through until the release of the man. And now we are getting weird statements from the Tories. This was going on during the Time Hayward sat at the helm.

    Now, what oil company is more important than the rule of law, the laws we have to protect us, be it the lives or airline passengers, those who live on vulnerable coastlines, or indeed the laws to protect our planet?

    Handshake? It should be handcuffs for him and his pals!

  • Comment number 47.

    Can't draw a pension until he's 55. Period. It will be an unauthorised payment from the Scheme.

    Also, before you get all carried away about what he "presided" over, remember that he has given BP 28 years of service. How many of you can say the same about your companies?

    But mainly, it will be BP shareholders who are on the hook for the pension, not the UK taxpayer. He isn't the first to retire on a big pension from BP and he wont be the last so calm...down... please.

  • Comment number 48.

    Why are Tony Hayward's pension entitlement and pay-off "bound to be hugely controversial"? Read BP's last annual report and accounts. These employee benefits and service contract termination provisions were clearly spelt out.
    Tony Hayward has not been dismissed. He has singularly taken responsibility as the head of a company which was involved in an environmental disaster and the death of 11 rig workers. I don't see the politicians lining up to resign for their part in wrecking the world economy or slaughtering any number of innocent Afghanis.
    How frustrating it must be for Obama and his posse of truth seeking Congressmen that the BP board has not joined in the gaderene rush to judgement.
    There seems to be precious little evidence so far that Tony Hayward was any more responsible for the oil rig explosion and consequent pollution than any of the millions of US consumers clamouring for cheap petrol and the US government which licenced and regulated drilling 5,000 feet below the surface of the Gulf of Mexico.
    There are lessons to be learnt from this disaster, which cost 11 lives. The current unseemly rush to judgement and summary execution of BP's chief executive is no substitute for careful evaluation of this whole sorry saga.

  • Comment number 49.

    44. At 10:56pm on 26 Jul 2010, Nick wrote:

    "For me this was always about an attempt to grab BP America."

    Comment of the thread. Absolutely spot on.

    ----------------------------------------

    You are an ideological pygmy

    You are still thinking along national boundaries...they just do not exist!

  • Comment number 50.

    Nick #1 and #21 is/are completely right. I am a BP shareholder and think Haywood has behaved honourably and with great dignity. He has earned the money over many years of dedicated service. Haywood might not have talked in that confident but vacuous way Americans do but he is an excellent man. I am VERY unhappy an American might take over, just because he is acceptable to the US, what about the rest of the world and what about the British future of BP.

  • Comment number 51.

    Oh for heaven's sake, get over it.
    Give the guy a break1
    Is the man meant to be omniscient?
    It's clearly the fault of the guys that owned the rig and switched off all the bleedin' alarms.

    I'm as much for Obama as the next guy but he jumped the gun when he said the blame was squarely on BP's shoulder.

  • Comment number 52.

    bozza wrote:

    "But mainly, it will be BP shareholders who are on the hook for the pension, not the UK taxpayer. He isn't the first to retire on a big pension from BP and he wont be the last so calm...down... please."

    Totally incorrect. BPs pension fund is a separate entity from BP Plc. It is sufficiently funded by its member's contributions and investment performance to meet all its future liabilities. The shareholders of BP will not pay a penny towards Haywards pension.

  • Comment number 53.

    I'm tempted to post "Sigh" "Yawn, yaawwwwwnn!" but I won't.

    While I would tend to agree with anyone who says there is now a serious disparity between ordinary people's earnings and the stratospheric numbers earned, not just by bankers and oil men but sports people, entertainers, etc., and this needs to be addressed before we collapse into a mess that makes the Russian revolution look like a Sunday School picnic, but I will ONLY do so if they are prepared to make some practical suggestions about how to solve the problem.

    It's so easy to whinge away on the sidelines but not come up with practical and positive suggestions. Anyone can throw rocks. Putting something worthwhile on the table is something else.

    Here's one for the Coalition to consider. Legislation to place Board level remuneration in the hands of small shareholders, taking it away from remuneration committees and corporate shareholders. Discuss.

    Hey! Let's be useful out there, tomorrow!

  • Comment number 54.

    "You are an ideological pygmy

    You are still thinking along national boundaries...they just do not exist!"

    Give me a break. Do you *really* think the US and Obama don't want Exxon or Chevron to acquire BP's US assets? Do you *really* think even Exxon or Chevron don't want to acquire BP's US assets? Of course they do!

    BP is a foreign supplier to the US; something Obama said he wants to ween the US off of. So if Exxon or Chevron buys BP's US assets, then viola!, a US company becomes the clear largest provider in the US.

    To suggest there are no national boundaries over this is whole situation is just, well, laughable.

  • Comment number 55.

    in 38. John wrote:
    "Did the legal lower age limit for starting to take a pension not increase from 50 to 55 on 6 April 2010?

    see: [Unsuitable/Broken URL removed by Moderator] "

    yes and no. The first paragraph of the document says that there are exceptions, and if you read the small print at the end it explains what they are; basically if the pension scheme rules gave him the right to retire early at his own request in both 2003 AND 2006 - then he still has that right.

  • Comment number 56.

    54. At 00:09am on 27 Jul 2010, Nick

    Give me a break. Do you *really* think the US and Obama don't want Exxon or Chevron to acquire BP's US assets? Do you *really* think even Exxon or Chevron don't want to acquire BP's US assets? Of course they do!


    Nah, they don't pay much in the way of taxes to the US treasury so buying up BP won't be that much use to the US voter (well, the ones that get their vote counted, at least).

    This isn't about 'America', no longer the home of the free and white pciket fence, but land the free and wandering homeless with tents or cars to rest their weary heads as they try to ignore the hunger pangs, wanting BP (found this with a bunch of youtube videos http://sifakahops.blogspot.com/2010/07/civilization.html), this is about a group, a very small group of people getting BP and even better portolios than Hayward has.

  • Comment number 57.

    "Wasn't there... the worst ecological disaster any country has faced on it's shores?"

    No, everydayperson. The US has had a worse ecological disaster - a gusher in California that went on for over a year and spilled something in excess of 10 times the current estimate for Deepwater Horizon. That was in the early part of the 20th century.

    Mexico suffered a catastrophic blowout in about 1988 - Ixoctl II or something. It was in the Gulf but mainly affected Mexico, with a bit blowing to Texas. Whether it was worse or not as bad as Deepwater Horizon is not clear, at this time.

    The Niger Delta has suffered total destruction of thousands of sq km of mangrove swamp over teh past 40-odd years - and it continues.

    The Upper Amazon in Ecuador is another blot on thelandscape.

    that's just off the top of my head.

  • Comment number 58.

    He has worked in the company for 28 years and deserves his pension!!! Not like the bank chiefs who were taking huge bonuses from the taxpayers funds.

  • Comment number 59.

    I've seen so many comments on British websites worrying about the supposed backlash against the UK by America over the oil spill. It all comes over as pretty insecure really because the majority of Americans don't blame the UK for this. Heck, a lot of my fellow citizens don't even know what the initials 'BP' stand for! Why then are we getting a backlash against a non-existent backlash? Stop trying to pick a fight. It's not your coast getting ruined after all. Give us a break on this one!

  • Comment number 60.

    It may sound like a lot of money to retire on, and it is. But in persentage terms it is normal with a earnings related pension.

    Regarding the USA's attack on BP, who was the oil for? If the demand was not there they would not risk this kind of drilling. The men died and the oil slick is down to us all, we buy the stuff.

  • Comment number 61.

    Apart from anything else I thought pension legislation a few years ago limited pension pots.Does this legislation not apply to these guys?

  • Comment number 62.

    Can we all please stop moaning about pension rights that are contractural? They may be large but are written into lawful contracts. One day, the Government will "do something about this" and it will be ordinary saps like me that will find our pension rights taken away and our hard-earned pots confiscated on some pretext of "fairness". We may not like these enormous pension entitlements but we have to fight to the last round to defend them or we will all lose out!

  • Comment number 63.

    Tony Hayward earnt his pension over his years and to me it's reasonable that he retains it.

    However, to me he was not doing what was required of a CEO. Part of the job is PR and part of that job is organising the company so that the 'man on the rig' can't do something that brings the whole company to the point of failure. I'm sure that he did great work in his previous roles and did some things as a CEO well but all that goes if you run the company aground. For that reason he should have been dismissed without 1 years compensation. None of the rest of us would be treated in that way.

    To all those who say national boundaries are a thing of the past: Fine, act that way and the UK's national boundary will be gone. And we will bet tucked inside somene else's national boundary, economically, politically and maybe even physically. You can then kiss you hard earned vote, freedoms and opportunities a short goodbye.

  • Comment number 64.

    You're all just jealous.

    Sure it would be nice if my 'redundancy' package had been anywhere near as large, but the only reason for my departure was that the establishment concerned was skint and they whined enough about what I did manage to negotiate (I learned to bargain in Egyptian souks!). Like nearly everyone else, though, I just have to get on with it, find another job and...

    Hey, do BP want a chief executive? I'm available right now :)

  • Comment number 65.

    If Mr Hayward having worked at BP for 28 years has as part of his terms and conditions, a pension to the level you would expect for a senior manager why do we find it necessary to try and blacken the name with reports on the amount he will receive, this has nothing to do with the problem BP are facing,

  • Comment number 66.

    I agree with many of the comments (include 1. Nick). This is a matter for BP and its shareholders.

    Of more concern is the poor reporting by the BBC. Second item on the news - Hayward to get £600k pension in a desperate attempt to seal Hayward's fate as public enemy No. 2 after Fred Goodwin. Hayward has been made a scapegoat mainly because he didn't get his handkerchief out and start mopping up the spill himself. This made him unpopular with the South Coast Bubbas.

    Whatever your view of the handling of the spill, I am sure Hayward is no numpty. You don't get to his position by being a numpty. Let's face it, he must have at least negotiated (presumably lucrative) contracts for offshore exploration in the States.

    So why is the BBC jumping on the band wagon. Lazy, lazy, lazy. If he was resigning and the BBC thought it newsworthy, where was the profile of his career? Where was the context? It would have certainly made more sense than having 2 minutes of non-comment by Peston. Very poor.

    Interestingly, the first item on the news was about leaked documents appearing on a blog site regarding the War in Afghanistan. This is the sort of thing that the BBC used to pride itself on getting and investigating.

  • Comment number 67.

    It does not matter who the CEO is or was - they all do their jobs in a very similar way.

    One of the more sickening sights of this whole affair was the row of CEOs from competing US oil companies sitting in DC and nodding sagely that they would have never conducted the drilling the way BP did.

    These would be the same CEOs who have fought against having the same tight regulations in the US as we have in the North Sea following the US created Piper Alpha disaster.

    Hypocrites.

  • Comment number 68.

    2005 - Texas City explosion
    2006 - Prudhoe Bay shut down when BP Trans-Alaska pipeline found to be corroded
    2007 - Lord Browne forced out, Hayward takes over

    In that context, have a look at this (American) article, not a terrible hatchet job, in my view. In the City and on Wall Street Hayward has been praised for cost-cutting. On accepting the job he promised to focus 'like a laser' on safety, but financial happiness with Hayward can't have been about that -- they don't know about drilling, only costs, and safety is a cost.

    Whatever people say here about Americans and the British, it will be an extraordinary investigation that proves one way or the other what effect BP executive decisions had on safety practices during Hayward's three years, and that just raises the question: How can any single person be worth that kind of money? There is no proof that thousands of other competent people wouldn't do the job just as well.

    If the UK is a "laughing stock" as Nick says, it would be helped if UK corporation management were, as Hayward promised three years ago, a bit more basic -- connected to the rock face. That takes hundreds of people in a large hierarchy like BP, and must include proper dealings with its contractors. You can't give one person the credit for that. It's laughable to pay anyone so much, even if they get the leadership of that process right.

    In this case, the failure of BP management processes is being blamed on the leader, who is being paid for the privilege. The blame, the payment, and the idea that one person runs BP are in fact laughable. Hayward's hubris was that he thought he was in charge and was changing that hierarchy because of some numbers on a profit-and-loss statement. That's just as bad as the RBS case, and fortunate for the world that it was 'only' the Gulf of Mexico rather than the global payment system.

  • Comment number 69.

  • Comment number 70.

    Hmmm.

    I wonder how Hayward would do as the 'star in a reasonably priced car'?

    1.45 perhaps?

  • Comment number 71.

    I personally think that the role of the US gov has been more than juvenile during this time of crisis. The congressional hearing that Mr. Hayward was by all accounts obliged to sit through, was nothing more than a manifestation of America' blood thirst. I found it obscene that Mr Hayward was put on trial as if he has been on the rig, personally executed every misguided command, then flown to safety before the rig blew.
    In all of this, it is moot to say that Halliburton and co. also had an equal share in the blame, as a boisterous social body will always lay the blame firmly outside it's control.
    The body needing the biggest overhaul is in my opinion the US Bureau of Ocean Energy Management, Regulation and Enforcement. Who had decreed that the operations undertaken by Halliburton, BP, Transocean, and Exxon, were legitamate, financially viable and safety compliant. Yet it would be the ultimate humiliation for the US to let it be known that a goverment body who's sole task was to regulate such operations as undertaken by the aforementioned corporations, had failed in it's duty, and in doing so had gently deposed a substantial chunk of the blame on the shoulders of the US administration.
    British Petroleum exists only in the mind of those who can remember a state owned oil company. BP is a global leader in it's field, and has demonstrated that with superbly diligent response operations. In effect I think that Barack Obama' branding of BP as British Petroleum, has rather backfired all things considered. The British should be proud of being the apparently direct representative populace of BP, given the respectability that the firm maintained (bar in the eyes of indoctrinated americans and greenpeace, who even in normal operative times would claim BP was the worlds leader in Polar Bear slaying).As the US declared it to be, so it shall stick, BP represents the UK.
    The US has once again displayed it's incapability of dealing with large scale environmental "gaffs", by acting as it has in every field (foreign policy, military operations, political backing) Like the pre-pubescent school boy who had the apparent "fortune" of having an early growth spurt, with ham like fists, and a teenage warbling voice it monsters on, attempting to suffocate (the half american share controlled) BP. Beware Mr Obama, as you pension pot may also have a BP stake, under the guise of some more appealing investment instrument.

  • Comment number 72.

    he deserves every penny of the pension

  • Comment number 73.

    The Americans are full of crap and blustre

  • Comment number 74.

    This amount is obscene. Nobody, and I mean nobody, deserves anything like this.

  • Comment number 75.

    Well , BP have now really , really , got to cut corners to make up for their massive losses ( evidently caused by cutting corners while they were making massive profits ) - whos going to tell the guys working at the dangerous end to put their lives at even more risk ?? And whos going to tell the people within spilling distance that major production cost economies are now going to have to be made ??

 

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