Ford government and Hydro One at odds over CEO salary

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A showdown over executive pay is taking shape between Premier Doug Ford’s government and Hydro One after the publicly traded company proposed a cap of $2.78 million for its next CEO.

Energy Minister Greg Rickford warned the province will not approve more than $1.5 million in salary and incentives for the chief executive as a search wraps up with a preferred candidate to replace ousted boss Mayo Schmidt, whom Ford dubbed the “six million dollar man” in last spring’s election campaign.

“We will not stand by any further and see out-of-control and out-of-touch salaries at Hydro One,” Rickford told a news conference Friday, calling on the partially privatized former Crown transmission utility to show “respect for Ontario’s electricity customers.”

The Hydro One board — replaced by the government last summer — quickly fired back, insisting it needs leeway “to attract, retain and motivate highly-qualified leadership” at the company with $25 billion in assets and annual revenues approaching $6 billion.

“We continue to seek the approval of Management Board of Cabinet.”

Hydro One had proposed up to $1.86 million for executive vice president and $140,000 for directors, with $169,500 for the chair of the board.

Rickford described the disagreement as a “significant divide between the views of the Hydro One board and the largest shareholder, the people of Ontario.”

Hydro One board chair Tom Woods — who was appointed by Ford — noted in a separate letter to Rickford that majority shareholders in the company owned 47 per cent by the province are good with the $2.78 million CEO cap.

“As you know, we have been in discussion with a very talented prospective CEO, who we believe would accept the role with compensation as contemplated under the proposed framework,” wrote Woods, a veteran investment banker with CIBC.

“As we have previously advised, the entire top management team (five individuals) are under retention agreements and it appears likely that all five will depart soon after their agreements mature in the next 2 1/2 months.”

New Democrat Leader Andrea Horwath said the split public-private ownership of Hydro One engineered by the previous Liberal government is proving unworkable, pointing to a need to bring the company back under full provincial control with a share buyback.

She warned that government “meddling” in Hydro One — a reference to the Schmidt ouster — has already cost the company $103 million (U.S.) for a “kill fee” after American regulators cited concerns about “political interference” in the company, scuttling a $6.7 billion takeover of Avista Corp.

“Mr. Ford’s got to realize he can’t keep pretending he’s trying to save people money while at the same time undertaking activities that are costing us millions,” Horwath told reporters a day after the premier, in launching a new strategy to save auto sector jobs, proclaimed “for too long, government has been getting in the way.”

In the letter to Rickford, Woods said he recognizes the government’s push to reduce electricity bills but said “none of Hydro One’s top executive compensation will be charged to customer rates — it will all come out of bottom line company profits, borne by shareholders, not ratepayers.”

The government issued an order in August that Hydro One trim “generous pay packages,” with Rickford refusing to say publicly at the time how low they should go.

Critics have warned that government interference in pay levels for a publicly traded company will send a chill through the business community.

Under legislation passed last summer, the government retains the power to control executive, CEO and senior executive salaries at Hydro One until the end of 2022.

Rob Ferguson is a Toronto-based reporter covering Ontario politics. Follow him on Twitter: @robferguson1

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Mayor John Tory wants to keep a lid on Toronto police salary hikes, he tells the Star in a year-end interview

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Mayor John Tory wants to keep a lid on Toronto police salary hikes but says officers don’t compare themselves to other city employees who got below-inflation raises.

Tory made the comment in a year-end interview with the Star Thursday, as he reflected on four years in office and the fresh four-year mandate that lies ahead, thanks to his commanding autumn re-election win.

Tory said he and fellow members of the police services board will soon give negotiators guidelines for talks with the Toronto Police Association, which represents more than 8,000 officers and civilian employees.

In 2015, under Tory, police won pay hikes of 8.64 per cent over four years.

Tory’s administration bargained hard in 2016 with city inside and outside workers represented by CUPE locals, winning below-inflation hikes of about 5 per cent over four-year contracts.

The mayor said he is inclined to see a “relevant comparison” between contracts, but said they aren’t “apples to apples.” Police union officials “negotiate more within the context of what other police officers in the province are making,” rather than other workers paid by the city, he said.

Toronto police first-class constables this year earned a $98,450 base salary, but those receiving maximum “retention pay”, a bonus that survived the last negotiation, earned $107,312. The total police budget will cost taxpayers just over $1 billion this year, most of it in salaries.

“Being a police officer is the most complex policing job that probably exists in the province and they do a very good job at it …,” Tory said. “Ideally, you would have something that is consistent with the overall desire I have as the leader of the council, which is to run a government that can expand services and manage affairs responsibly, but within the context of a low (property) tax increase.”

Another big challenge for Tory in 2019 will be dealing with Premier Doug Ford, the former councillor who settled into office by slashing the size of council in mid-election over the objections of Tory and his council colleagues.

The mayor said the two have since had productive meetings, but acknowledged the busy agenda of Ford’s Progressive Conservative government has not included passage of regulations allowing for the use of traffic wardens, rather than paid-duty police officers at busy intersections, or for the city to issue traffic tickets using photo radar in school zones.

Tory said much of the city’s wait on those safety initatives happened under the previous Liberal government but he remains frustrated. “To me, it underlines that, on these matters, we shouldn’t have to go and ask. We should have the latitude to … make the decision ourselves.”

Nor has the Ford government committed to honoring his predecessor’s pledge to reduce GO train fares within Toronto to $3 to integrate with TTC prices.

“All (the province) has said to me so far is they’re looking at reducing those fares to reduce the gap between the two (fares), but I have no commitment that they are going to do what had previously been agreed upon” and was to have taken effect Jan. 1, Tory said.

Fare integration could help relieve acute congestion on Toronto’s subway lines because riders, especially those in Scarborough, have told him they’d switch to GO for daily commutes if the prices were the same, the mayor added.

It is unclear what say Toronto will have over SmartTrack stations it has agreed to fund in conjunction with provincial Metrolinx’s regional electric rail expansion; the province wants to develop new GO stations in partnership with private developers in exchange for “air rights” to build above the stations.

“I’m not afraid of any of this,” said Tory, who added that the city should examine provincial requests-for-proposals on station development, but, if it doesn’t like the proposals, should be allowed to stick with paying for a station, itself, and deciding on the design.

“I’m quite willing to take a look at the results of such a process, but (am) always quite mindful of the need to have proper planning, and the need for us to have development which is compatible with what is going on in the rest of the city,” Tory said.

Any provincial attempt to using ministerial zoning orders to overrule city zoning guidelines for SmartTrack station construction would be “a serious issue between the City of Toronto and the province of Ontario”, Tory said. “I just don’t anticipate that is what their plans are.”

In his 2017 year-end interview with the Star, Tory said if he won a second mandate he would work more closely with progressive downtown councillors.

His recent choices for committee chairs leaned heavily on past suburban allies, with only, Ana Bailão, from the Toronto-East York community council, a downtown representative. The mayor says now that he honoured his pledge because he tapped Joe Cressy and Paula Fletcher for key posts at city agencies.

“I looked (the pledge) as being a greater inclusion of downtown councillors in the decision-making process of the government … consistent with my own obligation to move the mandate forward that I’ve been given by the people,” to expand transit, increase affordable housing and keep taxes low.

Since re-election Tory has opened the door to the possibility of seeking a third term, something he previously said he would not do. He now says that door remains open, but, as he starts his second term, he is not giving it any thought.

“It’s nothing to do with legacy; it’s everything to do with trying to address transit and housing and build a great city,” the mayor said. “If I saw a threat to that, that might cause me to make a decision that would be more likely to try to continue as mayor.”

David Rider is the Star’s City Hall bureau chief and a reporter covering Toronto politics. Follow him on Twitter: @dmrider

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Liberal MP Nicola Di Iorio to give back salary until retirement in January

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The mysterious case of a missing MP has taken another twist.

The Liberal party’s whip says Nicola Di Iorio, who hasn’t been seen on the Hill since Parliament resumed on Sept. 17, will give back the salary he receives during his final five months as an MP until his official retirement.

According to Mark Holland, the Montreal MP has decided to “donate his salary back” during the period from September to Jan. 22.

READ MORE: Liberal MP Nicola Di Iorio announces resignation after parliament absence

While he’s been absent from the House of Commons, Di Iorio was spotted at a cannabis trade show in Montreal last month, where he made a presentation in his capacity as a labour and employment lawyer.

The base annual salary for an MP is $172,700 but, according to parliamentary rules, an MP who is absent from the Commons can be docked $120 of salary per day for each absence over 21 days.

WATCH: Jagmeet Singh calls out Trudeau not calling byelections






Di Iorio announced his intention to retire from politics in April but had second thoughts over the summer and, in September, said he was reflecting on his future.

Last week, under pressure to explain why he wasn’t showing up for work on the Hill, Di Iorio posted a short message on Facebook saying that Prime Minister Justin Trudeau had assigned him responsibilities that required him to be away from the Commons — something the Prime Minister’s Office has not clarified.

READ MORE: This Liberal MP hasn’t been seen on Parliament Hill since September — his colleagues aren’t sure why

This week, Di Iorio announced he will retire on Jan. 22, after finalizing “certain projects.”

“He has a number of items, both in his constituency and items that he was working on as a Member of Parliament, including his concern around impaired driving, that he wants to finish before he leaves,” Holland said Wednesday.

“We feel that’s appropriate, particularly given the fact that he’s also … willing to donate his salary.”

In his Facebook post, Di Iorio had said he’s willing to show up in the Commons if the party whip needs him to be there. But Holland did not appear inclined to call on him.

“He’s stepping out of public life, he’s donating his salary, he’s finishing up his affairs,” Holland said. “And I wish him all the best in doing that and I expect that that’s where he’ll be focusing his time.”

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