Ontario Premier government Doug Ford has decided to restrict the total compensation for the next CEO of Hydro One at $ 1.5 million, said senior government sources at The Globe and Mail.
The plan was made to direct a "hard cap" of $ 1.5 million in total to compensation for the next chief executive of Hydro One at this week's planning and priorities committee, meeting with Mr. Ford and the top cabinet members, the sources said. Details of the hard cap have not been completed, but it could include the salary as well as stock and benefits options. But sources could not say if the cap included growth of stock options. It is also unclear what compensation would be triggered if the person left.
The Globe was given fame to the sources because the issues were confidential.
Mr Ford and cabinet ministers were seen as a competitive salary on the figure of $ 1.5 million, but in line with Mr. Ford, he pledges spending on the utility rates and lower water rates, said a higher source of government.
Former CEO, Mayo Schmidt, had become a lightning rod for dissatisfaction over raising electricity rates during the spring election campaign. Mr Ford had labeled CEO "the six million dollar man" because of his compensation and promised to fire the executive if he was elected. In July, Mr Schmidt retired who resigned the convenient board suddenly after reaching agreement with the Tory new government. Mr Ford said he had done well on his pledge, but Mr. Schmidt has qualified for $ 9 million worth of stock incentives and options after retirement.
The chairman of the Hydro One board has been told about government plans for a cap and is planning to hold a board meeting on Friday, said sources. The government's senior source said that cabinet does not want to return to a large operating pay package and would use its legislative authority to prevent one.
The last month's Globe and Mail reported a barrier between Mr Ford's government with independent directors on the Hydro One board over who will be the next CEO. The Government and industry sources told The Globe that Mr. Ford made its own favorable candidates to lead Hydro One, including Anthony Haines, CEO of Toronto Hydro.
The province owns a 47 per cent share in Hydro One, after the previous Liberal service has been privatized. The board has 10 people of six independent directors and the rest is appointed by the government.
The government's senior source told The Globe that the province respected the ability of the board to choose its next CEO, but it needs to be within the compensation framework set by the cabinet. The senior source said that the committee had also expressed concern regarding the compensation offered by members of the board for themselves.
Mr Ford has promised to reduce the rates of hydro by another 12 per cent. The Tories have also passed omnipotent legislation, which in turn gives authority to the government to approve a functional compensation in Hydro One. The bill requires that the board of directors of Hydro One establish a new compensation framework for the CEO and the board of directors in consultation with the province and the five largest utility shareholders .
Increasing Conservatives have already passed their own legislation, known as the Hydro One Liability Act, which gives a veto to the Premier over executive charge. The new action also requires the company to disclose what it intends to pay to senior executors, something that the new board has not done .
Hydro One's chairman, Tom Woods, recently told the Washington state manager that the utility was considering paying his next CEO between $ 2 million and $ 4 million each year. At the time, the banker told investments retired that the Ontario government had not approved the board compensation scheme.
With reports from Andrew Willis and The Canadian Press