Salary review before Hydro One gets CEO
TORONTO, ONTARIO - Multi-million dollar compensation packages for top executives at Ontario Power Generation and Hydro One are too high for government-owned utilities, Ontario Energy Minister Dwight Duncan said today as he announced a review of the way salary levels are set at provincial energy agencies.
DuncanÂ’s move comes after former Hydro One CEO Tom Parkinson walked away with $3 million in severance in December when he quit amid criticism of expense account irregularities and his $1.6 million salary and bonus.
In appointing a four-member panel to recommend new methods of determining executive compensation for energy officials, Duncan said the pay should “reflect the public service nature of their mandates.”
He said public utilities should not be trying to compete with private-sector salaries on Bay Street.
The Liberals claim salaries at Hydro One, Ontario Power Generation (OPG) and other agencies rose after the previous Conservative government tried — and failed — to privatize Ontario’s electricity market, but the Tories point out it was the Liberals that agreed to Parkinson’s lucrative compensation package.
In addition to Hydro One and OPG, the panel will look at the compensation levels for executives at the Ontario Power Authority, the Independent Electricity System Operator and the Ontario Energy Board.
Critics point out the salaries of Parkinson and Ontario Power Generation CEO Jim Hankinson, who also pulls in about $1.6 million a year, dwarf the $480,000 paid to the head of Hydro Quebec and the $405,000 earned by the president of B.C. Hydro — both of which are combined generation and transmission utilities.
ParkinsonÂ’s predecessor as Hydro One CEO, Eleanor Clitheroe, was fired in 2002 for lavish spending on top of her $2.2 million annual pay package, but launched a $30 million lawsuit against the province that is still before the courts.
Duncan also announced Monday the government will not appoint a new CEO of Hydro One, the giant transmission utility, until the salary review is completed in late spring.
Laura Formusa, who was appointed to replace Parkinson on an interim basis recently, will remain interim CEO of Hydro One until the review is complete and a full-time successor is named.
The panel will also look at areas of overlap between the various provincial agencies involved in the generation, transmission, regulation and marketing of electricity, but Duncan said it wonÂ’t be looking to recreate a single generation and transmission utility like the old Ontario Hydro.
“This is about continuing to strengthen the electricity sector and ensuring our energy agencies continue to focus on delivering our priorities,” Duncan said in a statement.
“We want stability for the sector. We want to keep our agencies in public hands.”
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