Monday, February 28, 2011

Crown Corporation salary burden

British Columbia has about 30 Crown Corporations, and these cost money. To put Crown Corporation growth into perspective, let's compare the situation in B.C. with Ontario and Alberta. Between 1990 and 2010, the number of bureaucrats employed in Crown Corporations fell by 16 per cent in Ontario, 64 per cent in Alberta, but grew at about 1 per cent in B.C.

What about the wage burden? In Ontario, the total wages paid to bureaucrats increased by 94 per cent between 1990 and 2010, but actually fell in Alberta, by 16.4 per cent. In B.C., however, the wage burden grew by a whopping 146 per cent.

Employment and Salary Change

Number of Employees
Salary Burden
Source: Statistics Canada

If we take a closer look at BC Crown Corporations, according to Statistics Canada data, total employment fluctuated between about 22,000 to 24,000 in the 1990's, then fell to about 18,000 in 2006, before it took off again and now sits back at about 22,000. 

What about wages?  If we add up all the wages paid to bureaucrats at Crown Corporations, we get an idea of how much of a burden these crown corporations create for taxpayers. In B.C., the wage burden went up from about $650 million to about $1 billion between 1990 and 1997, then stayed fairly steady until 2008, when it took off to $1.6 billion.

BC Hydro pays huge salaries. At the moment, it is asking for a 50 per cent increase in electricity rates over the next five years to cover off increased costs, but why do we never hear about cost-savings measures? In 2010, Bob Elton, the former CEO, made almost $680,000 in salary and $40,000 in expenses. There, employees making over $75,000 per year account for more than 75 per cent of the total wage burden of about $570 million. If you are wondering why BC Hydro rates are going up, high and growing wage costs is one of the reasons.

Crown corporations don't face the discipline of a competitive marketplace, so costs go nowhere but up. It's time to get government out of the business of providing services better provided by the private sector.  Taxes just can't go any higher to pay for a system that is unaccountable and out of control.

Link to government sector pay

As I promised today during my regular Monday morning CFAX interview, this is the link to the executive salary disclosure statements of government sector organizations such as Crown Corporations.
Executive Compensation Disclosure

Friday, February 25, 2011

Crown Corporations you've never heard of

I commented last night on Global TV during Ted Chernecki's Dollars and Sense series. The comment outlined a much bigger problem - well-intentioned policies often have very destructive results. 

What happens when government sees a problem? It tries to do something about it, and that something sometimes results in a new Crown Corporation.

One of those Crown Corporations is the First Peoples' Heritage, Language and Culture Council. This Crown has the mandate  to ensure aboriginal languages don't become extinct. I has been around for 20 years, spent about $1 million per year, and now, aboriginal languages are becoming extinct.

It is, of course, clamouring for more money. But will other peoples' money help save aboriginal languages in the future when it hasn't in the past?

It's time to judge policies by their results, not their intentions. If people truly value aboriginal languages, they have to take responsibility themselves. They can't pass responsibility off onto someone else.