Ontario’s Wynne calls some public sector executive raises ‘unreasonably high’

The province has argued higher salaries are necessary to maintain top talent for the province’s nuclear facilities. PHOTO: Ontario Power Generation

TORONTO—Premier Kathleen Wynne says that some proposed and potential raises for public sector executives—with one salary cap at $3.8 million—are “unreasonably high” and warns that some raises might be refused.

The Feb. 1 statement came after the Liberal government faced days of criticism for raises totalling up to $8 million for about 80 executives at Ontario Power Generation and a potential raise of up to $118,000 for the head of transit agency Metrolinx.

Wynne’s statement did not make clear whether she was targeting OPG or Metrolinx or both.

“Although the vast majority of public postings have been potential salary ranges thus far, it is very clear that in some cases the upper end of the ranges are unreasonably high, and could potentially lead to unacceptable salary increases,” she wrote.

As a wage freeze lifts, all broader public sector agencies have until September to post their proposals for new executive compensation packages under a framework that caps salaries at the 50th percentile of “appropriate comparators.”

Though OPG did not publicly consult on its salary cap of $3.8 million for its CEO, who currently gets $1.5 million a year, the government has said it won’t order the nuclear operator to redo the public consultation to include the dollar figures because it acted “in good faith.”

OPG has said the CEO’s salary will actually remain unchanged for three years, but the other approximately 80 executives will now be eligible for merit pay, and when the new program is fully implemented in 2019, that’s expected to cost an extra $6 million to $8 million annually.

Metrolinx is still in the consultation phase and has proposed to boost its CEO’s salary, currently about $361,000, to a minimum of $375,300 and a maximum of $479,500.

Wynne noted that the government sent colleges back to the drawing board after concerns were raised about the salary comparators that they were using for proposals that would boost presidents’ salaries by up to 50 per cent.

“Today, I asked the president of the Treasury Board to send out a memorandum to all employers designated under the act, which will lay out our expectations during this process,” she wrote. “In cases where employers fail to comply, we would refuse salary increases.”

Treasury Board President Liz Sandals landed in some trouble herself Thursday, when she was asked how she thinks the raises look to people sitting on a delayed GO train.

“When you really stop and think of it, most of the people sitting on the GO train probably don’t have high-level nuclear qualifications or the business qualifications to run a multi-billion-dollar corporation,” she said. “The talent is exceptional to be in those exceptional positions.”

PC Leader Patrick Brown called Sandals’ remarks condescending.

“We found the comments of Liz Sandals disparaging towards commuters,” he said. “Coming from the city of Barrie myself, I can tell you there’s some very smart individuals, very capable, very talented individuals that ride the GO train every day.”

NDP finance critic John Vanthof said Sandals insulted the intelligence of commuters.

OPG, which operates two nuclear sites and is responsible for more than $40 billion in assets, was granted permission by the government to use private-sector comparators because of its unique size and scope.

It posted an 11-page document on its website through December for public consultation that detailed how it calculated executive salary caps, but didn’t actually post the caps themselves on a 12th page until Jan. 1, when the consultation was over.

The Treasury Board, the department that controls the government purse strings, said OPG was the first public sector agency to undergo the process and OPG “worked in good faith” to ensure the final document was in compliance. The government is reminding all broader public sector organizations going forward that they must post their salary caps during the public comment phase.

OPG received four public comments during its consultation. Sandals admitted it’s “entirely possible” they would have received more if the dollar figures were included.

Energy Minister Glenn Thibeault said OPG was experiencing a brain drain, so retention is important.

“For me it’s about safety, the safety of our nuclear plants and OPG right now, we need to ensure that we have the best nuclear technical experts we can get and I’d much rather have them working in our plants than leaving our plants,” he said.

Former Liberal energy minister George Smitherman weighed in Wednesday night on Twitter, writing that Thibeault has “taken the nuclear bait in allowing CEO salary to go hog wild” and urging Thibeault to “get a backbone.”

Thibeault said a $3.8-million cap is not “hog wild.”