Wow. I am gobsmacked. I actually believe with Jack Layton on something, and think finance minister Jim Flaherty is completely wrong on this:
"According to the fund's annual report just released by the CPP Investment Board, David Denison, the president and CEO of the CPP, along with his top four executives, will take home a total $8.5 million in pay and bonuses for the 2009 fiscal year.
Additionally, the executives are due another $7 million in long-term awards that will be paid out over the next three fiscal years.
Denison earned a total of $2.9 million in the last fiscal year -- down 30 per cent from $4.2 million the prior year -- including a base salary of $490,000, an annual bonus of $735,000 and "long-term incentive plan" awards of $1.6 million.
He also earned $59,023 in pension contributions and $9,571 in other benefits, which the CPPIB said include life insurance, disability benefits, and health and dental plan costs. "
Now I know the argument for the bonuses is going to be that they have contracts that were previously signed and must be honored. The problem is the workers at GM, Chrysler, Air Canada, and a bevy of other companies have been forced to give up concessions, even though some of the previous contracts were signed just months ago.
The other problem I have is rewarding failure. The CPP fund lost billions of dollars from the market meltdown. How that equates to a performance bonus is beyond me. I do know that the salaries of these exec's comes from the plan itself and not government revenues. But that just makes it worse as the average Canadian looking at that deduction on their pay stub every week will be livid knowing these bonuses are being paid.
I know this is Canada and we tend to bitch to ourselves rather than those who deserve it, but I would imagine that if there was a major public backlash like what happened in the States with A.I.G exec's bonuses, either the exec's or those above them would do the right thing and roll back the bonuses.
4 comments:
The CPP is a doomed plan, the minute the boomers start retiring we are done, it exists only to enrich bureaucrats and keep the myth of "the just society" alive.
GM signs a contract with CAW, and then because the economy tanks, they do not honour the contract, would that not be the same thing?
What does CAW do? Strike.
If I take a job because they promise me a bonus for good performance and then they say oops sorry you can't have it, is that fair?
Also look at what the Liberals did to EI, they took $54 Billion and moved it into general revenues and spent it. CPP is totally separate from the government for exactly that reason. If the government could get their hands on the more than 100 Billion in the fund, they would just spend it, then people with no savings would have no lifeline.
Keep CPP out of the hands of the government! As a matter of fact, get EI out of their hands.
I said it elsewhere... I agree with the idea that the CPP Investment Board doesn't deserve the bonuses. But, the Conservatives are in a Catch-22 here.
They can do as they are doing and say that they cannot interfere with the Board and get blasted because of something that they are not willing to try and control... or they can step in and interfere with a body that was created arms-length from the government for a reason and get blasted for interfering with a board that the government shouldn't interfere with (according to Liberals like Paul Martin who set it up this way).
There's nothing the Conservatives can do that will not result in blowback over. Besides... the board has been in place for 12 years and nobody has had a problem until now. Why? Because we're in the start of a recession where normal economic situations don't apply.
Yes, it seems unfair that these board members are getting such bonuses. But, in good times they are well worth the money for their services. If we cut their pay, we would likely get less qualified people who wouldn't do so well with a single investment fund in the hundred Billion dollar mark. Does it make sense to have such knee-jerk reactions to this?
Back in the fall Harper said people could take advantage of lower stock prices and he got attacked for it. And yet if people had taken his advice and invested they would have already seen a 4% increase in their portfolio over the past 6 months alone. That is called reacting rationally and calmly to a difficult situation. We can't afford to get scared about our financial situation just because these guys are getting bonuses they otherwise would be getting in the private sector.
This is outrageous, as you say! The only sensible remark made from Taliban Jack for ages - he is right on!!!
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