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NDP takes aim at BC Ferries CEO's health perk

BC Ferries President David Hahn during a press conference Prince Rupert March 23, 2006.

John Lehmann/The Globe and Mail/John Lehmann/The Globe and Mail

The NDP ferries critic says there's no reason the CEO of BC Ferries should be taking home $10,000 a year as a perk to cover out-of-pocket health expenses such as laser eye surgery and CT scans when he is getting paid about $1-million a year.

"Taxpayers would see this as a bit over the top," Gary Coons, the North Coast MLA, said Monday of the "executive health spending account" detailed in a June 27 statement of executive compensation for BC Ferries.

"This is a small piece of the outrageous package," said Mr. Coons. "This is one benefit David Hahn should do without and could do without. It seems to be paid on the backs of ferry users and higher fees."

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The NDP underlined the perk as a reminder of the government's failings to rein in "outrageous" compensation at the former Crown corporation, which was privatized in 2003.

After B.C's comptroller general raised concerns in 2009 about higher compensation at BC Ferries than at Crown-owned BC Hydro and ICBC, the B.C. government resolved to ensure senior executives are compensated at levels akin to those in the public service. Although the policy does not affect current staff, it will affect new hires.

Mr. Coons said it remains vexing that Mr. Hahn and other executives continue to earn sky-high salaries despite prospective fare increases of between 20 per cent and 100 per cent.

Transportation Minister Blair Lekstrom was unavailable for comment on Monday.

BC Ferries spokesperson Deborah Marshall said the $10,000 was a four-year-old provision designed to provide some "choice and flexibility" in health and medical costs not covered by Mr. Hahn's medical plan. These would include CT scans, chiropractor services, contact lenses and laser eye surgery.

She declined further comment on compensation for Mr. Hahn, who has been at the helm of BC Ferries since 2003.

The latest executive-compensation statement is for the fiscal year ended March 31, 2011. It says the $10,000 is made available to Mr. Hahn as president and CEO, while amounts of $5,000 for the same purpose are provided to three other executive officers.

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Mr. Hahn has defended his compensation in the past by pointing to his efforts to improve reliability and efficiency in the ferry service.

Kai Li, a finance professor at the Sauder School of Business at the University of British Columbia, said the health perk is fairly common among elite executives and that major corporations would be at risk of losing staff if they did not provide such benefits.

"There's a strong peer-firm effect - like benchmarking," said Prof. Li. "To me, it's a common practice."

The disclosure says Mr. Hahn's compensation last year was $1,128,139, including $500,000 in salary, $292,353 in annual incentive plans, $236,859 in long-term incentive plans, and $98,927 in pension.

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About the Author
B.C. reporter

Ian Bailey is a Vancouver-based reporter for The Globe and Mail.  He covers politics and general news. Prior to arriving at The Globe and Mail, he reported from Toronto and St. John’s for The Canadian Press.  He has also covered British Columbia for CP, The National Post and The Province. More

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