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FREDERICTON - Critics blasted NB Power Thursday after chairman Francis McGuire unveiled wage increases and a set of hefty bonuses for the corporation's top executives.

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STEPHEN MACGILLIVRAY/Canadaeast News Service

NB Power chairman Francis McGuire speaks to the media at a news conference in Fredericton on Thursday after announcing a performance plan for the utility.

The financial incentives were part of a 10-point performance plan McGuire said was designed to make the organization more accountable and transparent.

But aside from a more rigorous public reporting schedule and a stated goal to reduce carbon emissions by two million tons, the only major change in operations was a new set of financial incentives that could see the corporation's top executive receiving a $100,000 bonus on top of a $400,000 salary.

"The only thing I've seen new in here is wage increases and bonuses," Opposition Leader Jeannot Volpé said after a news conference in Fredericton, where McGuire and several other board members detailed the plan.

"I think the whole conference here today is just to justify higher wages and bonuses for some employees."

John Williamson, director of the Canadian Taxpayers Federation, said NB Power has an "atrocious record" when it comes to accountability and transparency, pointing to the Orimulsion fuel fiasco.

The public will rightfully be irked by the new bonus structure, especially given recent rate increases, Williamson added.

"If the executives at NB Power are going to look for more pay, more perks, they ought to have to demonstrate first why they deserve it, instead of coming out with a scheme that will see them paid a lot more," he said.

The new performance targets the nine executives must meet to receive a bonus worth as much as 25 per cent of their salaries are vague and could increase the utility's ballooning debt, said Daniel Theriault, who represented the public during the last hearing on NB Power's rate increase.

"The whole idea of giving increases and raises and bonuses when last year they spent the whole year saying what financial difficulty they were in "¦ I guess I feel sorry, particularly for low-income people who are struggling to make their power bills," he said. "Now they're hit with this after a total of 8.9 per cent increases over the last year-and-a-half.

"There's nothing concrete there, nothing specific, where they can say OK, you've met your checklist of 10 things and you get your bonus," said Theriault.

The corporation's top executive, David Hay, made $340,825 for the fiscal year ending in March 2007, according to public salary listings. His new salary range will be between $350,000 and $400,000, and executives who meet the performance targets will be entitled to bonuses of up to 25 per cent of their salary.

The salary range for the other eight executive members will be between $160,000 and $230,000.

Hay said the performance targets will be "really, really tough" to meet, but added the financial incentives will push people in the right direction. Even under the new plan, wages will still be significantly below the industry norm, he said, pointing to the importance of adequate compensation to retain top staff.

"We can't keep taking for granted that they will be here and continue to do these jobs at rates that are below others," Hay said.

Williamson said bonus systems such as this one are often set up in such a way that it is difficult for executives not to meet the targets.

A number of NB Power's targets refer to ongoing projects or previously stated goals, including limiting rate increases to three per cent each year over the next three fiscal years, integrating a minimum of 300 megawatts of wind energy into the grid by 2010 and managing the refurbishment of Point Lepreau. NB Power also announced the reinstatement of a strategic planning group to source lower-cost fuel alternatives.

Other initiatives include vaguely stated goals to "foster economic opportunities" in the province and help customers "maximize ways to conserve electricity," but there was no hard set of measurement standards in place for these targets.

McGuire maintained that all the goals outlined in the 10-point plan will have a combined effect of making sure rates in the province are kept as low as possible, despite a volatile economic climate.

"We all know what's happening with energy prices around the world, and these difficulties will continue to challenge the company," he said.

If executives meet the performance targets, McGuire said, the savings for New Brunswickers will far outweigh the salary increases and bonuses for executives.

He said the hope was to stabilize rates, but noted that in the face of soaring coal and oil prices, a rate decrease would be too much too hope for.

"If coal prices double again, you obviously can't absorb that," McGuire said.

The utility moved to reinstate the bonus program last year but Energy Minister Jack Keir quashed the idea as New Brunswickers were bracing for a rate hike.

However, it appears Keir has since warmed to the idea of rewarding high-level executives with more money.

"Executives in the energy business are sought worldwide; it is a very competitive industry. Compensation and performance pay must be competitive in order to keep the best and the brightest in the industry working for New Brunswick ratepayers," he said in a statement. "I am pleased that compensation levels for the utility's senior executive team will remain consistent with those in neighbouring utilities, and the key performance indicators will help ensure that the awarding of any future bonuses will be tied to strict performance criteria."

- with files from canadaeast news service