BC Ferries board backs Hahn over giant pension giant, government, standards, receive, released

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BC Ferries board backs Hahn over giant pension


VICTORIA — The board chair for BC Ferries today released a statement defending company CEO David Hahn, and the $315,000 annual pension Hahn will receive when he retires in 2013.


“Our Board fully supports the decision that was made many years ago to compensate David Hahn and other senior executives at private sector rates, reflecting government’s expectation that BC Ferries would achieve private sector standards of performance,” board chair Donald Hayes said in a statement released Tuesday.


“Everyone needs to recall the sad state of affairs that existed just eight years ago when BC Ferries was created as an independent entity," he continued.


"BC Ferries was in a crisis state and the organization needed a complete overhaul by private sector leaders with a track record of success. The overhaul has been successful, thanks to the leadership of David Hahn. Since arriving in 2003, Mr. Hahn has completely revitalized the company and BC Ferries is now a world leader in ferry transportation.”


The statement follows comments made Monday by Premier Christy Clark, where she blasted the pension as being "way, way too big."


"His pension should be in line with the kind of pensions that you see all across the public service in British Columbia, which are fair, which are competitive, which are, many people would argue, generous," Clark said on Monday.


"But not that generous. Over $300,000 a year in pension. I'm with the rest of British Columbians on this. I have trouble understanding it."


Hahn, who has come under frequent criticism for his $1.2 million a year in salary and benefits, is set to get $315,000 per year when he retires in 2013.


Despite her concern over the issue, however, Clark said the pension is enshrined in a contract and therefore she is powerless to change it.


"The thing is this is a deal that was made five years ago, and it's a legally binding contract. We are, as far as I can tell, stuck with it, sadly," she said, vowing not to allow similar packages in future.


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Hayes' full statement is as follows:

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“Our Board fully supports the decision that was made many years ago to compensate David Hahn and other senior executives at private sector rates, reflecting government’s expectation that BC Ferries would achieve private sector standards of performance.”


“In 2006, the Board re-negotiated Mr. Hahn’s employment contract to 2013 including increases to performance based compensation and pension entitlements to reflect his progress to date in renewing and re-structuring the corporation and to protect the corporation from ongoing recruiting efforts of Mr. Hahn from large private sector corporations in Canada and the United States. Mr. Hahn’s pension entitlement has not changed since then. His compensation arrangements, including his pension entitlement were confirmed by the B.C. Legislature when it enacted amendments to the Coastal Ferry Act in 2010. The compensation and pension details have been publicly posted for the last three years on both SEDAR and the BC Ferries website. Nothing that has been publicly reported in the last several days is new information.”


“Everyone needs to recall the sad state of affairs that existed just eight years ago when BC Ferries was created as an independent entity. BC Ferries was in a crisis state and the organization needed a complete overhaul by private sector leaders with a track record of success. The overhaul has been successful, thanks to the leadership of David Hahn. Since arriving in 2003, Mr. Hahn has completely revitalized the company and BC Ferries is now a world leader in ferry transportation.”


“It also needs to be remembered that the compensation and pension benefits were set with external expertise provided by the then leading human resource company, Hewitt and Associates. Through his tenure, Mr. Hahn has received Board approved compensation commensurate with the task and responsibilities given to him.”


“In the future, the Board will be following provincial government compensation guidelines, which only became applicable to BC Ferries in 2010. We are confident that the correct decision was made in 2003 to hire a private sector leader to set BC Ferries on a successful course for the future”.

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BC Ferries president David Hahn, who makes $1.2 million a year, will have an annual pension of $315,000 when he retires, which he says he will do when his contract ends in 2013.