BC Ferries bosses swap bonuses for higher pay
It won't be called a bonus any longer, but BC Ferries executives will take home almost as much money as they do now after a switch to a salary holdback plan.
After months of promises by Transportation Minister Todd Stone to fix the controversial bonuses, the corporation announced Wednesday they've been eliminated retroactive to April 1, 2013.
In their place is a new salary holdback system that raises the base salary of executives by the four-year average of their recent bonuses.
Part of the new higher base salary will be held back, starting next April, and be paid out only if performance targets are met.
BC Ferries' board chair Donald Hayes said the plan is in line with the province's guidelines for executive compensation at Crown corporations.
But critics aren't impressed.
"It's bait and switch," NDP leader Adrian Dix said. "This is a bonus scheme by another name. I don't know why the premier thinks people will be fooled by this."
BC Ferries executive vice-president and chief financial officer Robert Clarke received a $133,000 bonus this year on top of his base salary of $297,300, for total pay before pension contributions of $431,000.
Under the new system, his maximum salary will rise to $403,000, assuming he meets targets and isn't subject to any holdback.0
CEO Michael Corrigan's base salary rises from $364,000 to $425,125 and he is forecast to get the identical overall compensation of $563,000 in 2014 after pension contributions and other benefits are added.
Corrigan's pay is capped at that level, which is 60 per cent below former CEO David Hahn, who had been dubbed the "million dollar man" for the bonuses that took his overall compensation into seven figures.
The corporation said a holdback plan for other managers wasn't feasible so their base salaries will be raised by the four-year average of bonuses, which will no longer be paid.
Hayes also announced a two-year pay freeze for all executives and managers until 2016.
"A two-year pay freeze is meaningless when you're overpaying so dramatically," said Canadian Taxpayers Federation B.C. director Jordan Bateman, who pointed to the much lower salary of $165,943 paid to the CEO of Washington State's ferry system.
"I'd call this baby steps but that might be insulting to babies."
He said nothing has been done to address the real problem with bonuses or holdbacks – that they're meaningless if the targets are too easy to achieve.
The most recent bonuses were paid out for 2012 performance when the corporation recorded a surplus, but critics maintain that shouldn't have counted because the government injected $21.5 million in extra subsidies.
Bateman said no executive should get a bonus or a holdback repaid in years where BC Ferries raises fares or takes more money in provincial subsidies.
"That should be a deal breaker on bonuses and holdbacks."