The perks of working for EDF or "how heating a swimming pool is cheaper than boiling an egg"

"The real public service scandals" was a recent 40-page pullout in the weekly magazine Marianne, in which some light was shed on a number of issues usually under-reported (or largely ignored) by the mainstream media in France.

Schools, hospitals, the police, La Poste, SNCF and others were treated to a pretty thorough analysis, as was one of the nation's "international stars", the utility giant Électricité de France.

It makes fascinating reading.

Electricity prices for households in France are among the lowest in the European Union, but that could well change over the coming few years with a cumulative hike of around 30 per cent forecast by 2017.

Great!

While the rest of France will have to live with the increase, employees - past and present - of EDF, essentially a "public" company, will retain some level of protection.

Yes EDF is still a "public" company.

Although it pretty much operates to all intents and purposes as what might be perceived a "private" company or "limited liability corporation", the state still retains almost 85 per cent ownership.

Anyway, that's rather an aside.

Or is it?

Because wielding so much potential political influence, surely successive governments (and not just the current one) should at least have tried to put an end to a practice which no longer seems to be warranted but also seems downright illogical and not to say unreasonable: the perks enjoyed by the company and its employees.

Since 1946 the company's 300,000 current and retired employees have benefitted from privileges that might have been equitable when introduced but surely now lack credibility.

There is for example the 90 per cent reduction in the amount they pay for each kilowatt-hour of electricity.

Put another way, as it was in a report from the Cour des comptes or Court of auditors in February 2013, EDF employees pay a price per kilowatt-hour that's 16 times less than the average cost to the public.

Confusing figures perhaps but they all add up.

And there's more.

EDF employees don't just pay lower prices for electricity for their main residences.

Oh no.

If they're lucky enough to own a holiday home, the same benefits apply. And even apparently when they rent a house for a couple of weeks while on vacation.

That annual €74 subcription charge? Waived.

In the end, says Marianne, "at such prices, heating a swimming pool (for EDF employees of course) works out less expensive than boiling an egg (would do for everyone else).

But for justification as to why such advantages have remained at current levels since 1951 for electricity and 1962 for gas (yes, for historical reasons employees at GDF-Suez are also treated as a special case) union bigwig at Confédération française démocratique du travail (French Democratic Confederation of Labour, CFDT) Dominique Bousquebaud,  has the following explanation.

Try not to choke as you read.

"The system compensates for the fact that the salaries in the public sector are lower than those in the private and it helps attract better qualified workers," he says.

"It's a way today to compensate for the lack of profit-sharing that can be found at a high level in all major private companies."

Except, once again as Marianne points out, the Cour des comptes says that in fact salaries at EDF are slightly higher than in the equivalent private sector.

There again what does the country's body for auditing public institutions know?

If you want to read more about the tax breaks, the money lost to social security and how successive government have done little or nothing to alter the privileged status of EDF and its employees, try getting your mitts on the May 11-17 copy of Marianne.

Happy reading.

Now does anyone know of an opening at EDF?

Pay hike for GDF Suez number two

There's a certain amount of polemic (a favourite word within the French media) going on here at the moment over the pay increase Jean-François Cirelli, the vice-president of the French energy giant GDF Suez, received last year.

A cool 180 per cent according to the company's annual report released on Wednesday, pushing his salary up from a not-so-miserly €460 000 a year to € 1,3 million!

It was a pay rise agreed last August by the company's conseil d’administration (board of directors) to "take into account the growth and the size of the new group created by the merger of Gaz de France and Suez" a month earlier

A major problem of course in all of this - and one that has been mentioned throughout the media - is that GDF Suez, although in essence a private company, in that peculiarly French way has as its biggest shareholder.....yep you've guessed it, the French government.

A stake of 35.7 per cent to be precise.

So in a sense the pay increase was done with the agreement of the state.

GDF Suez came about in July last year through the merger of the previously 80 per cent state-owned Gaz de France and the French-based multi national, Suez.

Putting it simply, the result was an international energy and utility giant.

The justification for the huge hike in Cirelli's salary would appear to be two-fold.

Firstly according to Nicolas Cori, a journalist for the left-of-centre national daily, Libération, the decision was taken to realign the salaries of the top brass coming from Gaz de France (among them Cirelli) with those from Suez as a result of the merger.

And secondly the group posted profits in 2008 of €6.5 billion, an increase of 13 per cent.
- so it's not doing at all badly.

Oh yes, and let's not forget that management at the company also caved in to union and government pressure last month to renounce their rights to stock options.

But there's still something surely of a mixed message in all of this.

France has not been untouched by the financial crisis and economic difficulties around the world.

Unemployment is rising, companies are shutting down facilities, the government is still telling us all to tighten our belts and urging restraint.

And as Cori asks on his blog, "What exactly does it say about the 'moralising' of capitalism by the French president, Nicolas Sarkozy?"

He argues (and many would appear to agree if the headlines in the French media are anything to go by) that in a real sense the government - as the company's biggest shareholder - has also given the "nod" to what by anyone's standards is a huge pay increase.

Oh yes, just to complete the picture, you might be thinking that Cirelli is the head honcho at the company, but he's not.

Admittedly he's number two, but he still has a long way yet to go to match the salary of Gérard Mestrallet, his boss and the chairman and chief executive officer of the company.

Hang about and hold on to your jaw before it crashes to the floor.

Mestrallet's pay packet for 2008? Um...€3,1 million - just an 18 per cent increase.