New Brunswick politicians are still feuding over who is responsible for the controversial bonuses paid to NB Power's chief executive officer.

David Hay, the corporation's president and chief executive officer, defended his $96,000 bonus for last year, which was on top of his $375,000 salary, to the legislature's standing committee on Crown corporations on Wednesday.

Hay said he was simply collecting on what was offered to him in his contract.

The Opposition Conservatives maintain they axed the additional payments in 2006 when they were in government, but Energy Minister Jack Keir said that decision was only effective for one year.

The province's energy minister said the bonus provision in Hay's contract remained in place after that one-year moratorium lifted.

"I know the previous government said they cancelled it. They did not cancel it because David Hay could presumably sue for breaking the contract," Keir said.

Conservative MLA Jeannot Volpe, who was finance minister when former premier Bernard Lord made the move, said the decision was permanent and NB Power's board was not allowed to overturn the cancellation.

"They went back a year, two years back, to give bonuses when there was no performance indicator, and we already said no to it. This is wrong," Volpe said.

Hay's five-year contract is confidential but it expires in March, meaning the next debate may be over whether to keep him on and what his pay and bonuses should be.

NB Power's board of directors announced a new policy in 2008 stipulating bonuses would only be handed out when the corporation hit pre-determined objectives, such as running a surplus or achieving performance indicators. The requirements to obtain the extra pay, the board has said, will be made public so ratepayers will know what the NB Power managers are being asked to achieve.

When the former government suspended the bonus system, the utility's human resources department had a policy that awarded senior executives and managers with bonuses if specific objectives had been met. Those requirements, however, were not public.

The bonus Hay received, he told the legislative committee, reflected a spectacular year for the company in 2007-08.

NB Power won a $338 million legal settlement in 2007 with Petroleos de Venezuela, S.A., the country's state-owned oil company, over the failed Orimulsion fuel deal. Lord had hired Hay in 2004 at the height of the Orimulsion scandal and ordered him to find out how the utility began working on a $747-million refurbishment of a power plant without a signed contract for a fuel that is only made in Venezuela.

He said the Point Lepreau nuclear station ran well and the company was named a top employer. So the company's board decided to pay bonuses to him and several top executives.