The outgoing CEO of struggling French carmaker PSA Peugeot Citroen said he will give up his 21 million-euro ($30 million Cdn) pension pot after criticism from France's Socialist government.
Philippe Varin announced his decision in a news conference Wednesday a few hours after Finance Minister Pierre Moscovici called the pension sum "inappropriate."
Industry Minister Arnaud Montebourg was also critical of the pension settlement.
“Given PSA’s difficulties and given that the state has already underwritten [finance arm] Banque PSA Finance to the tune of seven billion euros ($10 billion Cdn), we have asked for some very thorough explanations from PSA on the financial arrangements of his retirement,” Montebourg said as he left a cabinet meeting.
PSA Peugeot Citroen is the midst of deep job cuts and a factory closure, and experienced falling sales during Varin's four years as chief executive. About 10,000 Peugeot workers have lost their jobs and union leaders were among those denouncing the rich pension package.
Varin's private pension was 310,000 euros ($445,470) per year after taxes, according to PSA. The French government has stakes in the company.
“Given the immense respect I have for our staff and the consequences of the difficult but necessary decisions I had to take, I have decided to relinquish the present provisions of my pension package,” Varin told a news conference on Wednesday.
A supervisory board at the company will work out a new pension package for him.
Varin's departure was announced Monday by PSA. He'll be replaced next year by a former executive at rival automaker Renault, Carlos Tavares.