Ontario Power Generation (OPG) has fired three top executives following the release of the 2013 annual report by the province’s auditor general, which called the organization’s pensions “generous by any standard.”
Since 2005, the employer-employee contribution rate at OPG has been about 4:1 to 5:1, significantly higher than the 1:1 ratio for the Ontario public service.
Executives are eligible for particularly generous pensions. The top five executives at OPG will be eligible for annual pensions ranging from $180,000 to $760,000 when they turn 65.
The report says HR costs also have a financial impact on the cost of electricity.
“About two-thirds of OPG’s operating costs are human resource related,” says auditor general Bonnie Lysyk.
The report also finds the following:
- OPG also bears the responsibility of financing any pension funding shortfalls. The most recent actuarial valuation, as at Jan. 1, 2011, showed OPG’s pension fund in a deficit position, with a shortfall of $555 million.
- Earnings and benefits were significantly more generous at OPG than for comparable positions in the Ontario public service, and many of OPG’s senior executives earned more than most deputy ministers.
- While reducing its overall staff by 8.5%, OPG has increased the size of its highly paid executive and senior management group by almost 60% since 2005, creating a top-heavy organization.
- About 8,000 employees, or 62% of staff, were on the 2012 Sunshine List of public sector employees earning more than $100,000.
- The number of OPG employees earning more than $50,000 in overtime pay has doubled since 2003.
- Even after staff reductions at nuclear facilities starting in 2011, the area of maintenance, janitorial and custodial services was still staffed at a level 170% above the industry benchmark in 2013. Meanwhile, some operational functions were understaffed, including nuclear plant operations.
- Numerous staff with family members working at OPG were not hired through the normal recruitment process.
OPG, a corporation owned by the province, was established in 1999 as one of the five successor companies to Ontario Hydro and is one of the largest power generators in North America.
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