Geoffrey Sargent's political career appears to be hanging by a thread after allegations that he asked Alderney Electricity (AEL) to pay him £800 a month.
AEL has been plunged into turmoil over the last fortnight and director Mr Sargent, an accountant by trade, appears to be at the centre of the problems.
The company's chief executive, Dick Haines, sent States members a dossier last week which included information about Mr Sargent asking to be paid for accountancy fees.
The papers also included a resignation letter from AEL's financial advisor, and former States member, Richard Willmott. Mr Willmott's letter is understood to contain a scathing attack on Mr Sargent.
Mr Haines, who is also AEL's chairman, heads a board of three. The other two directors are Mr Sargent and John Beaman, who is the States representative.
Mr Haines, who will soon retire as chief executive, told The Journal he refused to pay Mr Sargent £9,600 a year - a fee which would have increased islanders' electricity bills - as he found it "objectionable".
"It is correct [that Mr Sargent asked for £800 a month]," said Mr Haines. "I knocked it down and John Beaman knocked it down as well.
"It is a matter of principle. The principle is that non-executive directors have always been paid peanuts because it is a local service. No-one has ever done it for money - people do it to help the island.
"I found the suggestion objectionable and I've no idea why he [Mr Sargent] made it."
Mr Sargent completely denied asking AEL for money when approached by The Journal.
He said: "That is quite incorrect. This sounds like a pack of lies."
After being pressed further on the issue, Mr Sargent put the phone down.
Mr Beaman said: "I got a letter from Dick saying Geoff had asked for £800. I said it would have to come to the board, but it didn't."
Mr Beaman said Mr Sargent and Mr Willmott had clashed as they are both accountants.
He added: "I think Geoff is perfectly right in challenging things that Richard says, as he's a non-executive director."
AEL directors are paid £2,000 a year under the current rules. Mr Haines receives an extra £1,000 as chairman. Mr Beaman receives nothing as he is working on behalf of the States.
Mr Haines said AEL was suffering from too few directors.
"The States has a real problem in how it should deal with AEL. The States owns 74 per cent of the shares but will always have problems if they think AEL is a department of state. If a Mr Smith owned the company it would be different. The States members don't have shares in AEL - the shares belong to the general public.
"There have been three directors for the last considerable period and two of them have been States members. That has been part of the problem. Having two States members on the board shouldn't have caused a problem but there is a power thing and it's got to be resolved."
Mr Haines said AEL needs between five and seven directors.
"I've been trying to get more directors for a considerable time and recently proposed two people but they were rejected by the other two directors. No reason was ever given.
"Before I had seven directors and that was a fairly plural outfit. Hopefully some new directors will come forward and change things."
Mr Haines said the States had micro-managed AEL recently.
"It's only the last three years the States has been interested in what the company was up to. It was after a study report was done. The report didn't show anything startling - it just said the States had 74 per cent of the shares and its directors were liable. This is part of the director issue but I'm hoping we will get back to a situation where the States does not micro-manage."
Mr Beaman said AEL was doing all it could to appoint more directors and denied the company was being micro-managed.
"We need a bigger number of directors and the best way to do that is to advertise, which is what we've done.
"Dick did suggest two people but it was felt a proper procedure should take place before anyone is appointed. It was suggested that if any directors knew somebody, they should tell them to apply.
"We haven't been micro-managing AEL. We've just been checking that everything's above board and appropriate."
Mr Willmott confirmed he was stepping down on June 1 but refused to talk about Mr Sargent or the reasons behind his resignation.
He said: "It is a good time to move on as the 2010 audit is completed, loan and bank facilities are in place, which will cope with all but catastrophic sudden oil price rises, and hopefully the recruitment of a business manager will come to fruition in the near future. No doubt the person appointed will be able to assume the role previously undertaken by myself."
The Guernsey Bereavement Service has made three visits to Alderney over the past few months and would like to continue to help you. We are visiting the island again on
Tuesday, 23rd February 2024 and would invite anyone who feels they would like Bereavement Counselling to telephone the Bereavement Service Office on 257778 to make a time to meet one of our counsellors.
The Guernsey Bereavement Service has made three visits to Alderney over the past few months and would like to continue to help you. We are visiting the island again on
Tuesday, 23rd February 2024 and would invite anyone who feels they would like Bereavement Counselling to telephone the Bereavement Service Office on 257778 to make a time to meet one of our counsellors. 