The conductor on the left does actually enter through a rubber grommet, although it isn't too clear in the picture. That's not a piece of metal sticking up in front of it -- It's just a loose piece of plaster which had found its way into the box, most likely through the opening on the top which, as David pointed out, should have had a blanking grommet fitted.
Here's a closer view of the bottom section, taken from the thread in the non-U.S. area:
Sorry that it got a little "fuzzed" in the blow-up, but you can just about see that there is a grommet on that left hand entry.
Still a pity that someone brought in one phase per knock-out, though.
Interesting point about a grounding strap on the door. I've never seen an MEM unit of this type with such provision, although when the front is closed the screw on the left probably tightens it down securely enough to give a good ground.
The cables run in an open fashion like this between meter and panel is the way you will usually see it done on residential and small commercial sercvices like this one. The phase (and neutral) conductors are double insulated.
[This message has been edited by pauluk (edited 06-06-2003).]