NBN defends boss Stephen Rue's $3 million pay packet during pandemic

The National Broadband Network's chairman says spending millions of dollars on executive bonuses is justified amid the worst recession since the Great Depression because the taxpayer-funded infrastructure has helped Australians through the pandemic.

NBN Co boss Stephen Rue is now the nation's highest paid taxpayer-funded chief executive after earning $3.1 million in the past financial year including a $1.2 million bonus. Six of his senior managers were paid more than $1 million last year, the publicly owned corporation's annual report shows.

NBN Co chief executive Stephen Rue.Credit: Alex Ellinghausen

Federal Communications Minister Paul Fletcher, who nine years ago took aim at NBN's salaries as comparable to those at the "Millionaires' Factory" of Macquarie Bank, would not comment on the million-dollar wages on Tuesday. Instead, his spokesman said the corporation operated in a commercial environment and its pay rates were a matter for the board.

NBN Co's annual report revealed its management team received $2.9 million in personal bonuses for the last financial year, a nearly 40 per cent increase compared to $2.1 million the year before.

The top executive team was collectively paid $11.4 million in 2020 and all but one of the top executives received a seven-figure total pay packet.

"The COVID pandemic required, as a priority, that NBN continue to provide a resilient network which Australians could trust, not to withhold compensation from those people who have made it work and have justly earned their incentives," NBN Co chairman Ziggy Switkowski said.

"[The NBN] has performed very well throughout the COVID-19 pandemic when the nation has needed it most."

At the same time the board of Australia Post, also a government-owned business, vetoed all bonuses for its executive team, with its managing director Christine Holgate taking a 20 per cent wage cut amid massive unemployment.

Ms Holgate was paid $2.6 million in 2019, including an $830,000 bonus, but took home $1.6 million this year after a voluntary 20 per cent pay cut and her board vetoed personal bonus payments amid the economic climate.

In the private sector, Telstra chief executive Andy Penn received a total package worth $3.7 million in 2020, down from $5 million in 2019.

The average full-time worker earns $1,713.90 a week - or $89,076 a year - according to the Australian Bureau of Statistics.

Australian Taxpayers' Alliance executive director Emilie Dye said Australians had been hit hard amid the worsening economic situation following the pandemic.

"Now is not the time for bonuses paid to public service workers paid more by more taxpayer debt. We should be finding a way to be giving more money back for everyday Australians that are suffering."

Labor government accountability spokeswoman Kimberley Kitching said the salaries prove the NBN Co "really is the Millionaires' Factory".

"But far from being a profit-making entity, every dollar the Government allows them to shell out for excessive bonus payments is a dollar funded by taxpayer debt," she said.

A spokesman for Mr Fletcher said the NBN Co operated in a commercial environment and remuneration was an issue for the board and management. "These decisions are not made by government," he said.

Labor has fiercely attacked NBN Co for routinely shifting its corporate plan forecasts to manufacture a positive outcome that "distracts from the underlying trend".

Labor communications spokeswoman Michelle Rowland criticised the missed targets and the rising costs during a recession. "Cost blowouts, fake targets, and technology backflips — what exactly are taxpayers rewarding other than Liberal spin and incompetence?"

The Sydney Morning Herald and The Age revealed earlier this month that more than 850 employees at the national broadband network are paid above $200,000 a year with more than three-quarters of its workforce earning six-figure salaries.

An NBN Co spokesman said forecasts in the corporate plan were refined over time and bonuses are tied to different targets. He said employees' salaries had been kept at the same level for 2021 as 2020 except for promotions and bonuses tied to achievements of the company and individual performance.

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