Huge retirement payouts for Onesteel

Brambles chairman Don Argus is getting a much-deserved grilling from shareholders at the AGM in Sydney as you read this.

And Crikey has discovered another example of Don't Argue's pathfinding record on pay rates and payouts for directors and CEOs.

We wondered into the Onesteel AGM in Melbourne yesterday primarily to give chairman Peter Smedley a slap for the mess he made of Mayne's hospital business.

But on reading the notice of meeting we discovered that Don Argus and his fellow BHP directors spun this company off in 2000 with the most lucrative director retirement scheme going around the market.

For the last three years, Smedley and the non-executive directors have been receiving retirement benefits equivalent to 100 per cent of their basis board pay. In Smedley's case he get a fee of $250,000 and another $250,000 paid into his retirement account.

NEDs get about $82,000 in base fees so the total annual package is a very handy $164,000.

Back in 2000 when this was conceived, director retirement payments were already on the nose and companies like Lend Lease had moved to phase them out.

Crikey told the Onesteel meeting yesterday that these retirement benefits were outrageously high. A bloke like Smedley simply did not need to be so greedy considering he walked out of Colonial in 2000 with an estimated $23 million payout, including an indexed pension for life now running at more than $900,000 a year.

Onesteel shareholders approved the abandonment of the retirement scheme yesterday but as compensation directors lifted their maximum collective base fee from $1 million to $1.3 million and also will be getting free shares bought for them by the company to the value of 45 per cent of their fees.

All up its quite a rort and something that Don Argus and his fellow BHP directors at the time should be embarrassed about.

Onesteel managed to delay telling the ASX the final proxy votes until this morning but the new director fees packages saw some resistance as 155.43 million votes were cast in favour and 19.42 million against.

Smedley got re-elected more comfortably with 175.6 million in favour and only 3.59 million against.

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