Directors of Dunedin City Holdings Ltd and its seven companies are set to get pay rises adjusted to reflect similar positions in other parts of New Zealand, minus a 25% "community service discount" which reflects the service aspect of the roles.
Listed electricity retailer Contact Energy was roundly criticised late last week over a proposal to double its directors' fees, and it has been estimated up to 5% of its customers may switch to other suppliers as a result.
Dunedin Mayor Peter Chin yesterday said "this is not a Contact situation".
The council was following a four-year-old policy and formula for setting fees, which until last year's fee round were lower than in other areas. The council "had been playing catch-up", he said.
Overall, directors' fee payments will rise 12.4% from $732, 239 to $823,197. The average increase across all eight companies is 14%, ranging from a less-than-inflation increase of 3.4% for the parent DCHL, through to respectively 27% and 29.4% for Citibus directors and Taieri Gorge directors.
The council's finance and strategy committee last week voted 6-4 for the increase, but with the proviso that directors receive 25% less than the median fee calculated in the Institute of Directors' annual survey.
Cr Neil Collins told the committee meeting he had heard people elsewhere in New Zealand had declined increases because of difficult economic conditions, something he found "admirable". He suggested the same be done in Dunedin.
Cr Dave Cull said he calculated the increase to be 12.4% across DCHL and its seven companies.
But Cr Michael Guest said "No, no, no, no" to the idea of declining the rises.
"The amount we pay them [directors] is not that much."
Cr Guest said reasonable pay was needed to make sure the best people came forward to take the positions.
Cr Teresa Stevenson noted some people worked as directors on more than one board.
Twenty-three people hold 45 directorships with the eight companies. Five directors work on five or more companies.
Yesterday, Mr Chin was asked if it would be prudent, given the economic downturn, to more closely scrutinise the fee structure.
"No. The basis of directors' fees policy was done three years ago, when they were way below market value," he said.
The committee's recommendation will be considered by the council on November 3.
