Canadian Manufacturing

3 execs turfed at OPG following auditor general’s scathing report

by Keith Leslie, The Canadian Press   

Canadian Manufacturing
Operations Energy labour Ontario politics utilities

Utility increased size of senior management group by almost 60 per cent since 2005, report claims

TORONTO—Ontario Power Generation fired two vice-presidents and its chief financial officer after a damning report from the province’s auditor general about generous salaries, pensions and bonuses at the government-owned utility.

Compensation packages at OPG are “significantly more generous” than for comparable positions in the civil service, and have a financial impact on the cost of electricity, Auditor General Bonnie Lysyk reported.

“I’m sorry the findings are what they are, but we strongly believe that they will serve as a catalyst for achieving further positive change at OPG,” said OPG board of directors chair Jake Epp.

OPG has cut staff by 8.5 per cent, but increased the size of “its highly paid executive and senior management group” by almost 60 per cent since 2005, creating “a top heavy organization,” Lysyk said in her annual report.


“Earnings and benefits were significantly more generous at OPG than for comparable positions in the Ontario Public Service, and many of OPG’s senior executives earned more than most deputy ministers,” she reported.

Incentive awards for OPG’s non-unionized staff can be up to $1.3-million, and their top five executives will be eligible for pensions ranging from $180,000 to $760,000 a year.

OPG contributes “disproportionately more” to its pension plan that its employees, added Lysyk, with a funding ratio of 4:1 or 5:1—significantly higher than the 1:1 ratio in the public service.

“OPG is also solely responsible for financing its pension deficit, about $555-million in its latest actuarial valuation,” added Lysyk.

It’s no wonder our “hydro bills are going through the roof,” said Progressive Conservative leader Tim Hudak.

“As premier, I would reduce the size of OPG. I would make sure that these gold plated giveaway pensions don’t exist.

“Stop these pensions because people that are paying the bills, if they dreamt about that kind of pension they’d wake up and apologize.”

The New Democrats said Ontarians are paying the highest electricity rates in Canada because the Liberal government can’t control the provincially-owned utility.

“If you want to be a millionaire you don’t belong in the public sector,” said NDP leader Andrea Horwath.

“It’s respect for public dollars that should be the priority, but we see a total lack of respect for public dollars, not only by the OPG but by the governing Liberals.”

Energy Minister Bob Chiarelli said OPG knows the auditor’s conclusions are unacceptable.

“The auditor’s findings indicate that Ontario can and should expect better, and OPG takes this report as seriously as we do,” he said.

In her annual report, the auditor general also found it could cost the government up to $820-million or even more to divest itself of the Ontario Northland Transportation Corp., which the Liberals listed on the books as savings of $265.9-million.

“The (government) did not include a number of other significant revenues and expenses that would need to be considered in determining any net savings resulting from the divestment of the ONTC,” said Lysyk.


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