Sometimes the B.C. government has only itself to blame for the public beatings it receives. The latest controversy surrounding the beleaguered Community Living B.C. is a good example.
CLBC, a Crown entity, found itself at the centre of a storm last fall when it was revealed that it was moving people with developmental disabilities from group homes to cheaper accommodation in a bid to save money. It was also revealed that managers were receiving so-called “bonuses” that some suggested were tied to the cost savings.
Or at least that was the perception.
The minister responsible for CLBC at the time, Harry Bloy, was eventually fired over the affair and replaced with Stephanie Cadieux, who was forced to deal with the fallout. As it turns out she’s still dealing with it and not with much success.
Ms. Cadieux was roundly applauded last fall when she announced she was going to eliminate the bonus program – a good first step to rehabilitating CLBC’s battered image. But then, the Victoria Times-Colonist reported this week that senior executives at the organization were getting hefty pay hikes in lieu of the bonuses.
This touched off a fresh gale of criticism from unions and advocates for the disabled.
Ms. Cadieux had to face reporters and radio talk show hosts to explain the decision. The Social Development Minister didn’t do a very good job.
To be fair, the rookie minister inherited a politically explosive file. She was not briefed very well right from the beginning. Had she been, she might have avoided some of her mistakes. For starters, she should have explained that the “bonuses” managers were getting at CLBC were actually salary hold-backs, a system of compensation that is used for non-union staff across the civil service.
Let’s say a deputy minister’s base salary is $213,000. She might be guaranteed 90 per cent of it. The remainder is tied to job performance. Depending on the kind of year the deputy has, she might get the entire amount or a percentage of it. The hold-back in government circles is also known as at-risk compensation, the percentage of a manager’s base salary that is literally at risk depending on accomplishments.
The word “bonus” conjures up the image of money paid to someone over and above their base salary. (This is the case with some Crown corporations and quasi-government agencies such as B.C. Ferries). In that sense, at-risk compensation is not the same. Still, when she took over the file, and the so-called bonuses came under fire, Ms. Cadieux did not explain how the compensation system operated for non-union staff in government. She referred to the payments as bonuses as well.
That was her first mistake.
The second was when the Times-Colonist broke the story this week that senior executives at CLBC were going to get hefty pay hikes in lieu of bonuses. In fact, a plan to reconstitute the old compensation program was revealed in a Finance Ministry audit of the corporation.
“CLBC had recognized the issues with its at-risk compensation program in early 2011 and began working … to develop a plan to incorporate at-risk compensation back into salaries,” it said.
In other words, no longer would a percentage of their base salary be tied to performance as it is for other managers in the provincial government. CLBC managers would simply get all of their salary because of the perception they had a personal financial stake in cutting programs to meet government targets. In most cases, they will continue to get pretty much the same amount that they made under the old system. So they are not raises as the public generally understands them to be.
The idea of hold-back payments is to encourage government managers to work hard. They are supposed to act as an incentive. The fact is, the performance standards against which most managers are measured are often so low that most get a significant portion – if not all – of the balance of their base salary owing.
The Finance Ministry audit revealed that from 2008 to 2011, the percentage of CLBC managers who received their full hold-back amount increased to 93 per cent from 65 per cent “due to easily achievable performance goals.” In other words, the performance standards were, if not a joke, extremely lame.
And I’m not sure it’s a whole lot different across government. Most managers regard hold-back pay as their money and they expect to get it, or at least most of it.
Now, CLBC managers will get their full salaries and not have any of it held back against performance. Other managers in government must wonder how they can get so lucky.
It seems what you need to do is make a mess of things. Which is pretty much what the government has done with this file.