It’s Hard not to side with Scrooge (pre-redemption) despite the Christmas season when one takes in all of the public-sector waste, corruption and incompetence on display – yet again – this week.
Making headlines this week were the Ontario Auditor General’s scathing review of Ontario Power Generation, a damning audit of the shenanigans at the Toronto District School Board and more revelations of waste at ORGNE.
The OPG situation is a classic case of bureaucrats running the show, heaping entitlements on entitlements, all at Ontarians expense.
Auditor General Bonnie Lysyk exposes the goings-on at OPG, still the province’s largest provider of power (60 per cent) despite the growing list of private, alternative suppliers. Her report paints a picture of a top-heavy organization rife with greed, nepotism, mismanagement and contempt for doing right by the people paying the bills.
While staffing levels fell by 8.5 per cent between 2005 and 2012, the number of executives and senior management grew by 58 per cent. Senior staffers were far more likely to receive bonuses – as high as $1.3 million – than were those lower in the ranks under the organization’s annual incentive plan. The bonuses were paid without documentation or any indication why they were earned.
Some departments were continually overstaffed, paying out overtime deemed unnecessary.
A compensation-benchmarking study in 2012 found that base salary, cash compensation and pension benefits for a significant proportion of staff were excessive compared to market data. The Auditor General’s analysis showed that total earnings were significantly higher at OPG than total earnings for comparable positions in the Ontario Public Service. On top of that, OPG has a gold-plated pension system: since 2005, the employer-employee contribution ratio at OPG has been around 4:1 to 5:1, significantly higher than the standard 1:1. OPG is also solely responsible for financing its pension deficit, now more than $555 million.
About 700 pairs or groups of OPG employees reside at the same address and are likely related. In some cases, OPG had no documentation to show whether family members of existing staff had been hired through the normal recruitment process. In other cases, family members were given jobs although they had not appeared on any interview shortlists following the pre-screening processes.
Elsewhere, this is called nepotism.
Single-source contracting, undocumented bonuses, disregard for mandated wage freezes … OPG is the whole ball of wax when it comes to entitlements, making other parts of the public sector look like pikers.
That doesn’t apply to former ORNGE CEO Chris Mazza, who collected $9.3 million over six years, it was revealed this week. That number has been increasing as auditors do their thing.
At Canada’s largest school board, an audit found 45 per cent of external contracts were made without a competitive bidding process, contrary to the board’s own rules, with some 79 per cent of expenses for external contractors done through the director’s office failing to use the required system.
Following the OPG report, three senior executives were fired. Clearly, more need to follow, and not just for public relations reasons. The examples on display this week, and the many others that have come to light – along with the majority yet to be discovered – are the more extreme cases of the entitlement blight in the public service, and the incompetence of those who are elected to oversee the system.