Victoria has urged BC Ferries to find efficiencies and cut service in the wake of a financial report that shows vehicle traffic at a 13-year-low and passenger traffic at a 21-year low.
The quasi-private corporation, which is owned in part by the provincial government and receives taxpayer dollars to fund its operations, last month reported $16 million in losses for the fiscal year that ended March 31.
Transportation Minister Blair Lekstrom has long been pushing BC Ferries to operate more efficiently.
In the year that ended March 31, the ferry corporation took in $180 million from governments in the form of ferry transportation fees, social programs fees and provincial and federal subsidies.
In May, Lekstrom provided BC Ferries with an additional $79.5 million in government funding over four years and introduced changes to the Coastal Ferries Act aimed at keeping a lid on ferry fares.
As a condition of that funding, he said BC Ferries needs to find efficiencies to reduce operating costs.
Although Lekstrom stressed that community consultation would be extensive, his announcement spurred anxiety among ferry users who believe BC Ferries pays its executives too much.
Dennis Forsyth, a longtime member of the BC Ferries advisory committee on Denman Island, resigned earlier this month after citing concerns with how the ferry company pays executives.
The ferry corporation's annual compensation report last month revealed that former CEO David Hahn's compensation, including salary, bonuses and pension payments, topped $1 million last year.
CEO Mike Corrigan was paid more than $900,000, although one-third of his compensation came from a one-time payout from an incentive plan that is being eliminated.
Two other executives were paid more than $700,000:
•Glen Schwartz, executive vice-president of human resources and corporate development ($755,618); and
•Robert Clarke, CFO and executive vice-president ($743,653).
According to the compensation report, reducing the 17-member senior executive team that existed in 2008 to nine members has generated savings of about $2.7 million.
With further cuts to service seemingly inevitable, however, it is instructive to look at what routes are costing the ferry corporation the most money.
Route profitability can vary widely due to refit cycles and debt owing on vessels. •
