Editorial: City hall executives underpaid

The city should operate more like a business, is a common refrain from a certain wavelength of the political spectrum.

Groups like the Canadian Taxpayers Federation, Canadian Federation of Independent Business and Fraser Institute advocate that position - especially when it comes to public sector wages and benefits - and expect to hear it invoked again by candidates running for city council in the election this October.

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If the wages of the city's senior managers becomes an election issue, as one letter to the editor suggested earlier this week, then have no doubt some council candidate will decry the unbusinesslike wages and pay increases dolled out by the city. And they will be totally correct - no business the size of the City of Prince George would pay its executive team so little.

In 2017 city manager Kathleen Soltis was paid $237,487.10 - up 12.4 per cent from $211,282.55 in 2014 - to lead the city's operations. But if Soltis was president and CEO of Prince George Corp. - a medium-sized corporation with annual revenues of $165 million, with roughly 600 employees and hundreds of millions of dollars in assets - she'd earn substantially more.

The Canadian Centre for Policy Alternatives reported in January the average total compensation - that's wages, bonuses, stock options, shares, pension and other perks - for the 100 highest-earning corporate CEOs in Canada was $10.4 million in 2016. Compensation for the top CEOs has increased 41 per cent since 2008, when the 100 big-earners only took home an average $7.4 million. Canada's best-paid CEOs went from earning 175 times what an average Canadian worker earned in 2008 to 209 times the average workers' pay by 2016.

Soltis, on the other hand, earned less than five times the Canadian average.

Here is a sampling of some of the top 100 earners in 2016 whose companies have operations in Prince George:

Canadian Pacific Railway CEO Hunter Harrison, $18.8 million

Telus Corp. CEO Darren Entwistle, $12.9 million

Bank of Nova Scotia CEO Brian Porter, $11.7 million

CN Rail ex-CEO Claude Mongeau, $11.5 million

Air Canada CEO Calin Rovinescu, $9 million

Restaurant Brands International (Tim Hortons and Burger King) CEO Daniel Schwartz, $8.2 million

Fortis Inc. CEO Barry Perry, $8 million

George Weston Ltd. (Superstore and Shoppers Drug Mart) CEO Galen Weston, $7.5 million

Husky Energy Inc. CEO Asim Ghosh, $6.3 million

Hudson's Bay Co. CEO Gerald Storch, $5.9 million

Now, of course, the top 100 represent captains of industry whose corporations earn billions and employ thousands. According to a Bloomberg report in January, the average compensation for CEOs of Canadian publicly-traded corporations in 2016 and 2017 - based on International Monetary Fund data - was only $6.5 million, or about 149 times what the average Canadian worker earns.

But to get a better idea of what Soltis and her executive team would be worth in the private sector, let's look at a medium-sized B.C. business:

Vancouver-based tech company Avigilon CEO and founder Alexander Fernandes earned between US$1 million and US$4 million per year in total between 2013 and 2015, according to a 2016 report to shareholders.

Avigilon's former CFO Wan Jung earned US$153,554 to US$293,883 per year during the same period; former COO Bryan Schmode took home between US$603,205 and US$2.26 million per year; senior vice president of global sales James Henderson earned US$338,560 to US$916,612 per year; and CLO Joel Schuster earned between US$223,235 and US$1.7 million, all according to the same shareholder report.

Whether the rapidly rising compensation for senior managers in the private sector is warranted or not, it is the reality the City of Prince George faces when looking to hire and retain its executive team.

People like Soltis; city general manager of engineering and public works Dave Dyer; general manager, community services Rob Whitwham; general manager, planning and development Ian Wells; general manager, administrative services Walter Babicz; director of public works Gina Layte Liston; director of external relations Rob van Adrichem and the rest of the city's senior managers all have skills and experience which they could parlay into higher-paying jobs in the private sector.

So instead of berating the hardworking, talented and dedicated civil servants at city hall, perhaps we should be grateful they are willing to work to make this city better for wages substantially lower than the private sector would pay them.

-- News editor Arthur Williams

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