Opinion: Ottawa rewards failure with taxpayer-funded bonuses
By Franco Terrazzano
Bonuses are for people who excel at their job, not for people who fail at their job. Finance Minister Chrystia Freeland, who is ultimately the federal government’s paymaster, needs to be reminded of that.
The Bank of Canada handed out $20 million in bonuses in 2022 even as it hiked interest rates seven times and inflation reached a 40-year high. The central bank’s overarching objective is to keep inflation around “two per cent inside a control range of one to three per cent.” But though inflation climbed fully 4.8 percentage points above its target, the Bank of Canada gave 80 per cent of its workforce a bonus of $11,200 per person on average.
The Bank had also failed to meet its inflation target in 2021, when it handed out $18 million in bonuses — on the heels of $16 million in bonuses in 2020.
True, prices went up around the world, but Canada’s 2021 inflation rate was “among the very highest of any industrialized country,” according to the Fraser Institute. At 6.8 per cent, it was higher than in 74 other countries in 2022, according to the International Monetary Fund. Peers like Japan (2.5 per cent), Switzerland (2.8 per cent), Israel (4.4 per cent), Korea (5.1 per cent), Norway (5.8 per cent), France (5.9 per cent) and Singapore (6.1 per cent) all had lower inflation than Canada.
In many areas of life, accountability, or lack of it, is key. In 2022, Bank of Canada deputy governor Paul Beaudry acknowledged “we haven’t managed to keep inflation at our target,” adding that Canada’s central bank “should be held accountable.” Handing out bonus cheques is an odd way to hold your organization accountable.
Official Opposition Leader Pierre Poilievre is right to point out a growing cleavage in Canada: “If
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