Uproar at 40% Pay Rise for Top Managers of State-owned Slovenian Sovereign Holding

By , 06 Jan 2018, 09:25 AM Business
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But managers say their results warrant the increase. 

The STA reported on Janaury 6, 2017, that a considerable pre-Christmas pay hike for the two board members of Slovenian Sovereign Holding (SSH) has provoked uproar in the public, but SSH chief supervisor Damjan Belič has decided not to budge. He told the STA on Friday that the decision was made after careful consideration.

On 22 December, the SSH supervisory board decided to raise the gross monthly salaries of chairwoman Lidia Glavina and board member Nada Drobne Popovič from EUR 11,000 to EUR 15,500 and from EUR 9,900 to just under EUR 14,000, respectively.

The supervisors argued that the management, which is one member short, had created better conditions to manage state-owned companies, which was reflected in extraordinary growth of return on capital and dividends in 2016.

However, the 40% pay hike for Glavina and Drobne Popovič was not received well in the public and has prompted the government to request an explanation from the supervisors.

Lidija Jerkič, the head of the trade union confederation ZSSS, said the timing of the raise was wrong even if the move had been warranted.

"It is true that the results are good, but the message [SSH] is sending is imprudent," Jerkič told the newspaper Delo in reference to the announced strikes in the public sector over pay disparities.

SSH chief supervisor Belič, who remains unyielding, acknowledged that timing was the only potential lapse in the decision.

Pointing to the upcoming general election and the demands by public sector trade unions, he said he could agree with the sentiment, but he said this was "a political argument" and SSH supervisors only consider professional arguments in their decisions.

Belič, who would make the same decision again, will nevertheless prepare an explanation of the move by Tuesday as decreed by the government. He does not deem the request as a vote of no confidence.

The chief supervisor also stressed that SSH had met the standards of legislation capping the salaries of managers in state-owned and municipal companies despite SSH being exempt from the relevant act.

Nevertheless, salaries at the holding must be comparable to those at other similar sovereign holdings if Slovenia wants to attract good managers of state assets.

Supervisors determined the new salaries of SSH management board by making them comparable to leading financial institutions in the country, including the Bank Assets Management Company (BAMC), Slovenia's bad bank.

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