Gillian Livingston
London Free Press
April 29, 2004

Toronto: Executive salaries escalated to millions of dollars at Ontario Power Generation and Hydro One between 1999 and 2003, and that shows the government has to take control, an energy critic says. “In the near term, yes, there has to be some intervention on behalf of taxpayers through the provincial government,” said Tom Adams, executive director of Energy Probe.

“What we have here are two Crown utilities pretending that they were private sector firms and running up their salaries for their chief executives,” even though the business plans laid out by both companies over that time failed, Adams said.

“The fancy salaries were just another form of taxation, basically, on customers.”

The provincial government released yesterday the salaries of workers at OPG and Hydro One that were $100,000 or more between 1999 and 2003, when the two companies were shielded from the province’s so-called “sunshine” salary disclosure laws.

After a new law was brought in this year by Energy Minister Dwight Duncan, the two Crown corporations will have to disclose their 100-grand club annually.

Duncan said the province opened up these corporations to scrutiny to ensure the information was available to taxpayers.

“It will be up to the boards (of Hydro One and OPG) to make the proper decisions with respect . . . to how these people are remunerated at these organizations,” he said.

The records show the former CEO of Ontario Power Generation earned $8.2 million between 1999 and 2003, and the former CEO of Hydro One earned $5.3 million in salary and benefits between 1999 and 2002.

The records also show the percentage of staff at the two utilities earning more than $100,000 a year jumped at least 35 per cent since 1999.

At OPG, 3,980 of its 11,010 employees (36 per cent) earned benefits and salary of $100,000 or more last year. That compared to 1,759 of its 15,114 workers (12 per cent) in 1999.

At Hydro One, 1,324 of its 3,790 employees (35 per cent) reached the 100-grand club in 2003. That compared to 384 of its 5,632 workers (seven per cent) in 1999.

Former OPG chief executive Ron Osborne earned millions in salary and benefits, although the company he led failed to complete a retrofit of the laid-up nuclear reactors at the Pickering nuclear plant.

The plan is now years behind schedule and billions over budget.

Osborne earned $1.4 million in 1999, $1.8 million in 2000, $1.9 million in 2001, $2.3 million in 2002 and $933,000 in 2003.

Osborne was fired from OPG’s top job in December after a report blamed senior managers for botching the restoration of the Pickering plant.

The report also shows that four executives brought in to fix problems at OPG’s nuclear stations earned millions over 1999 and 2000. Two of the executives had salaries of nearly $2 million in 2000.

At Hydro One, former CEO Eleanor Clitheroe earned $741,000 in 1999, $1.4 million in 2000, $1.7 million in 2001 and $1.5 million in 2002.

Clitheroe was fired as CEO of Hydro One in July 2002 after weeks of controversy over executive salaries at the province’s publicly owned transmission utility. Much of the uproar centred on Clitheroe, who received more than $2.2 million in 2001, including $174,000 for a car and $172,000 for vacation.

Clitheroe is suing the government over her dismissal.

The rise in executive salaries at Hydro One led up to the former Tory government’s plan to privatize the transmission company. That plan was scrapped in January 2003.

Since then, “the business focus has changed. In those years the business focus was on an IPO (initial public offering),” said Peter Gregg, vice-president of corporate communications at Hydro One.

As a result, the number of managers at the company is down – as is the number of executives with top pay packages, Gregg said.

Current Hydro One CEO Tom Parkinson’s salary for 2003 totalled $1.1 million.