The government needs to keep a tighter rein on the rules surrounding how much Crown corporation CEOs are paid, B.C.'s auditor general says.

John Doyle's report, released Tuesday, found more than half of Crown Corporation heads in the province are earning more than the provincially set limit.

He said the 54 per cent of current CEOs are exceeding the limit because they were already in the positions before the rules took effect in 2007, and most serve indefinite job terms.

The report says the policy structure for awarding the salaries appears solid, but monitoring performance of the taxpayer-funded Crown executives is weak.

Doyle said the B.C. government has not been doing enough to ensure compensation rules are being followed and that limits for Crown corporations will take "several years" to be fully implemented.

The issue of CEO's paycheques came under fire two weeks ago when a report by B.C's comptroller said the annual salary of $1 million paid to BC Ferries Presdient David Hahn is almost twice that of the highest paid Crown executives.

BC Ferries is a former Crown corporation, however, it still receives public funding.

The paycheque

The report found the average compensation for the top five highest paid private sector B.C. CEOs last year was $8.7 million, while its Crown counterparts earned an average of $540,000. According to the most recent Canadian Census (2006), the average British Columbian working full-time earns $42,230.

Doyle said skill, responsibility and job complexity are some of the reasons given by Crown corporations to explain the high salaries. He also found the job pool is small for such highly qualified positions, so high compensation is required to "attract and retain qualified individuals."

The report reviewed compensation planning and management for executives at major provincial Crown corporations including BC Hydro, BC Lottery, Tourism BC, BC Assessment Authority, BC Securities Commission and Community Living British Columbia.

Warren Buckley, president and chief executive officer of the B.C. Pavilion Corp, took home the highest paycheque with $597,438.

The CEOs of BC Lottery, BC Hydro, BC Housing, Community Living BC, Partnerships BC and the Legal Services Society also earned more than the cap limit.

Here are some of the highest Crown corporation CEO compensations across the province:

  • BC Housing Management Commission $367,120
  • BC Hydro and Power Authority $549,923
  • BC Lottery Corporation $370,973
  • BC Pavilion Corporation $597,438
  • BC Railway Company $494,182
  • BC Securities Commission $549,092
  • BC Transmission Corporation $463,559
  • Partnerships BC $509,453
  • Tourism BC $389,506

Yearly salaries of less than $125,000 are not required to be reported.

The report found most Crown corporations align pay to match organizational goals and objectives but the link between results and pay was not always evident.

Two unnamed Crown corporations did not adequately document linkages, Doyle wrote. He is recommending these corporations make a clearer link between pay and performance.

Public perception

Doyle admits CEOs earning more than the allowed limit isn't something that sits well with the average B.C. resident.

"Because this topic is important to British Columbians, continued departure from the framework may negatively impact public observations and impressions," he wrote.

He says increased transparency will help increase public approval and perception.

Six other Canadian provinces have Crown corporation disclosure requirements through public sector disclosure acts.

To view the entire report click here.