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BC Ferries CEO takes smaller pension, bows out early

David Hahn, president and CEO of BC Ferries, is photographed during an interview in his office in Victoria on Tuesday, Sept. 27, 2011. Mr. Hahn has decided to leave his post at the end of this year.

Chad Hipolito For The Globe And Mail/chad hipolito The Globe and Mail

BC Ferries CEO David Hahn leaves for early retirement with a slightly reduced pension and a legacy that includes seven new ships, unprecedented labour peace, but also record-low ridership – and a scorched earth when it comes to his successor's salary.

The million-dollar man, as he became known, was hired nearly nine years ago to help take the Crown corporation into a semi-private structure based on a user-pay philosophy.

But his salary and pension benefits, pegged to private-sector corporations, came to dominate public debate over the ferry service.

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Mr. Hahn said Tuesday it was time to move on, now that "all the hard, really nasty stuff" has been wrapped up. "I could have easily sat here and coasted for the last year-and-a-half, but I would have been bored to death."

Mr. Hahn, 60, will receive no severance, but his pension benefits will begin when he leaves the corporation at the end of this year, 15 months ahead of schedule, as part of a cost-cutting exercise as the corporation grapples with ridership that has hit 20-year lows.

Public controversy over his $1-million annual salary led to legislation last year that ensures that pay and benefits for the top executives at BC Ferries will, in future, be comparable to other public-sector corporations.

But his pension, negotiated in 2006 with the board of BC Ferries, will stay in place. Under B.C.'s Public Service Pension Plan, Mr. Hahn was entitled to an annual pension of $75,948 if he retired on March 31, 2013. The supplemental pension would have been an extra $237,100 if he had stayed on. Mr. Hahn said leaving early will reduce that figure, but he could not say by how much.

"The issue isn't my compensation," he said. "All this is distracting from the discussion of who is going to pay." And that is the challenge facing the B.C. government and his successor, as the province reviews how ferry fares are set. "It's a very straightforward, well-documented user-pay philosophy and the government is now reviewing its public policy around that."

Transportation Minister Blair Lekstrom said the government had nothing to do with Mr. Hahn's departure. "Obviously, for personal reasons, [he]has made the decision that he is going to step out of the position."

The minister dodged questions about the future of the service and pricing, noting the independent commissioner is in consultations about a sustainable ferry system.

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"I think we have a world-class ferry system right now," Mr. Lekstrom said. "I think the funding and the price of that for our travelling public is a concern. I've heard that loud and clear, but David has done a good job as a CEO of BC Ferries."

Gary Coons, the NDP critic for BC Ferries, said the controversies around Mr. Hahn and his salary should be laid at the feet of the B.C. Liberal government that appointed him to run the service as a private company would.

"They have been treating it like a cruise ship experience instead of part of our transportation network," he said. "It's been horrendous, the last five years, for coastal communities, and David Hahn has been the cheerleader for the direction we've been going."

Mr. Hahn, known for his blunt talk, said his successor – to be named in November – will have an opportunity to take a less abrasive approach.

"I had to be pretty tough on every issue or nothing would have changed," he said. "The person that succeeds me might have a better opportunity to have more friendly relationships with the various user groups because all the hard, really nasty stuff had to be done," he said.

But he made no apologies for rubbing people the wrong way. "The biggest thing I didn't want, is anyone trying to figure out what I was trying to say. That's the problem with a lot of politicians, they are vague and not specific and you're always trying to figure out what they really meant."

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He said people might not agree with him, "but they are not confused about where I am coming from."

With a report from Ian Bailey in Vancouver

Under David Hahn's watch:

A deadly crash:

In the early hours of March 22, 2006, two crew members of the bridge of the Queen of the North were distracted by a personal conversation and failed to make a crucial course correction. The ship slammed into Gil Island, sinking the vessel and killing two passengers.

Built in Germany:

The three Coastal Class vessels, built at a cost of roughly $300-million, were commissioned to phase out some of BC Ferries' aging fleet. But they arrived in 2008 amid controversy because they were built in Germany, leaving B.C. shipbuilders in the cold. BC Ferries had to pay $120-million in import taxes but won a rebate from Ottawa in 2010.

Labour peace:

After a spate of labour battles that led to frequent disruptions in service, an arbitrator imposed a nine-year contract that expires in 2012.

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About the Author
B.C. politics reporter

Based in the press gallery of the B.C. Legislature in Victoria, Justine has followed the ups and downs of B.C. premiers since 1988. She has also worked as a business reporter and on Parliament Hill covering national politics. More

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