Two deposed chiefs shared a fault: misplaced loyalties

Seldom, if ever, have we seen two heads of prominent Canadian organizations simultaneously in so much trouble, that both chose to resign rather than face being fired.

Giuliano Zaccardelli resigned as RCMP commissioner, a day after admitting that he gave incorrect testimony on the Maher Arar affair to a House of Commons committee, saying he had “made a mistake” in earlier testimony about the Mounties’ involvement in the Arar case. Prime Minister Stephen Harper had expressed “concern” but said he wouldn’t fire the commissioner without fully investigating.

The Ontario government considered firing Hydro One’s chief, Tom Parkinson, after disclosure of details of his $1.6 million compensation package fueled a controversy around his expense claims. He abruptly resigned.

Parkinson was due to get a 4.9% salary increase in the new year, unless he was dismissed for skirting the utility’s policy on expenses that required his claims to be approved by the utility’s board of directors. He was criticized by Ontario’s auditor general for putting expenses - including $15,000 for an office move and $11,000 for an approved trip to Australia - on his secretary’s corporate credit card, then approving the claim himself.

Premier Dalton McGuinty, who facing opposition attacks for not quickly firing Parkinson, acknowledged that something “concrete” needed to be done about Hydro One. He told reporters he saw ‘a culture there that has not matured and evolved in keeping with this higher standard that taxpayers expect of all of us.”

As we see it, although the two chiefs’ situations might appear to be radically different, as heads of public-sector organizations they shared a similar defect - misplaced loyalties.

Any way you look at it, both men were appointed to their jobs to serve the public.

Commissioner Zaccardelli’s problem was that he saw his primary loyalty as being to the force he commanded, rather than to the public it was supposed to protect, that public including Arar.

As for Parkinson, his primary loyalty seems to have been to himself. His generous employment contract didn’t expire until Jan. 31, 2010, and entitled him to several perks, including a subsidy of $125,000 toward mortgage interest on the Oakville home he bought for $1.3 million. And if the native of Australia had been dismissed without cause, his contract called for two years’ pay plus full benefits and a bonus, likely totalling more than $3 million.

Ironically, the current controversy is reminiscent of that which dogged his predecessor in the job, Eleanor Clitheroe. In 2002, she was fired by Hydro One’s board and replaced by Parkinson, who had been with the utility since 2001 as its head of network services. Then, as now, the big issue was the CEO’s lavish spending.

Now an Anglican priest working for a relative pittance, Clitheroe became a lightning rod for controversy when the details of her salary and a lucrative severance package were made public.

She made over $2.2 million in 2001, which included $174,000 for a car and $172,000 in vacation pay. She also stood to get $6 million in cash if she left Hydro One for any reason, and stood to receive an annual pension of up to $1 million.

Those details set up a showdown between the Ontario government and the former board of Hydro One in the midst of the province’s attempts to privatize the utility.

Now, Ontario’s auditor general has found that apart from the CEO’s alleged improprieties, Hydro One executives approved $127 million in expenses made by staff with corporate credit cards, sometimes with receipts “that were often insufficient” to determine what was purchased.

One thing we think ought to be considered might be to undo the work of the Mike Harris government when it replaced Ontario Hydro with a seeming plethora of agencies, in hopes of privatizing at least some parts of the utility.

Maybe what the government should do is convert the OPA into a reincarnation of Ontario Hydro, giving it ultimate responsibility for electricity production and transmission as well as long-term planning. One individual could then be placed in charge, with instructions to trim the bureaucracies and eliminate the multiple boards of governors, and prove that a single entity can perform all the tasks necessary for Ontario to have once again what Sir Adam Beck championed, “power at cost.”