08/15/2012 11:12 EDT | Updated 10/15/2012 05:12 EDT

Ontario Public Service Bonuses To Be Reviewed, Dalton McGuinty Says

TORONTO - Ontario's cash-strapped government will review a system that awarded bonuses to almost all eligible senior public servants last year as it tries to eliminate a $15-billion deficit, Premier Dalton McGuinty said Wednesday.

He made the comments after The Canadian Press reported that nearly 98 per cent of eligible managers in the Ontario Public Service got bonuses in 2011.

It's concerning that "a lot of people" are getting bonuses, he said Wednesday after touring a Toronto school.

"If everybody gets pay for performance, it's not pay for performance, it's pay," he said.

"I think we need to revisit the whole concept of pay for performance, given our fiscal reality."

Earlier this week, the head of eHealth Ontario returned a hefty bonus after The Canadian Press reported it. Greg Reed, CEO of the provincial agency, received the $81,250 bonus on top of his $329,000 salary in mid-June.

McGuinty has asked all public sector workers to "hit the pause button" on their compensation to help the government slay the deficit in 2017-18.

Even members of provincial parliament have accepted a pay freeze for the last few years, he said.

The governing Liberals have clashed with both teachers and doctors in their battle to freeze pay, with McGuinty warning that if they don't accept it, his government will impose it through legislation.

He said he doesn't think performance pay should be eliminated, but Finance Minister Dwight Duncan will take a look at the practice and provide advice on how it "fits" as the province tries to tighten its belt.

According to documents obtained under freedom-of-information laws, about 8,700 of 8,900 eligible managers received performance pay in 2011, costing the provincial treasury $35.6 million.

The bonuses ranged from 0.46 per cent of the employee's pay to 12 per cent. The average was 3.6 per cent.

The government has said bonuses are part of the pay package for managers, and are only awarded to those who meet their performance commitments.

Those who received a bonus had their base salaries frozen, which has saved the province $34 million since 2009, the government said. The total cost of performance pay has also dropped 30 per cent — or $16 million — since 2009.

But the opposition parties say it's unacceptable that so many OPS managers were given bonuses in tough economic times.

The Progressive Conservatives slammed the bonuses as "outrageous," claiming it's further evidence the Liberals can't manage the province's finances.

"They simply haven't taken ownership of what's gone on within their own ministries," said Tory Rob Leone, whose party favours an immediate legislated wage freeze for all public sector workers.

"It's like they're asleep. And only when someone in the press notifies them to a problem is the time they actually react and respond."

McGuinty said the rhetoric is "a little bit overblown," given that performance pay was brought in by former Conservative premier Mike Harris.

The New Democrats also lent their support to the system by lending their support to a budget agreement that included a two-year freeze on performance pay at organizations like hospitals, colleges and universities, he said.

"I would ask only one question: who's been in government for the past nine years?" said New Democrat Gilles Bisson.

"Mr. McGuinty has known fully that managers get performance bonuses. This is not a secret to him. The only reason it's an issue now is because the media raised it and as usual this government tends to manage things after the fact."

The Liberals can't hand out bonuses to senior civil servants while demanding a wage freeze from everyone else, he said.

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