Andy Brandt sezs "Thanks Suckas!"

[Mississauga Matt]

Tuesday, April 8, 2004

The LCBO quietly pays CEO $2,100 allowance

By David Menzies, National Post

(excerpt)

The Liquor Control Board of Ontario pays chairman Andrew Brandt a $2,100-per-month living allowance to maintain a Toronto condominium, the National Post has learned.

However, the condo payments are not disclosed in the LCBO’s annual report, which is subject to the Public Sector Disclosure Act. The act requires public sector organizations to disclose annually the names, positions, salaries and taxable benefits of employees whose employment income is $100,000 or more per year.

The LCBO CEO does not declare this perk – worth abouth $25,000 per annum – as taxable income, which the federal government says is required under the Income Tax Act.

LCBO spokesman Bill Kennedy confirmed Mr. Brandt receives the monthly allowance to pay for a Toronto condominium.

Mr. Brandt also maintains a home in Sarnia, and has been receiving the allowance since 1991, when he first became chairman and CEO of the provincial liquor board, Mr. Kennedy said.

Mr. Brandt did not return calls.

News of Mr. Brandt’s allowance comes on the heels of Glen Wright’s abrupt resignation as chairman of the Workplace Safety and Insurance Board.

Mr. Wright resigned in early March after Dalton McGuinty, the Premier, claimed his use of public funds as “inappropriate.”

The WSIB paid $2,800 per month for Mr. Wright to maintain a Toronto apartment, and for an upgrade to the alarm system of his Kitchener residence…

.. Mr. Kennedy said the living allowance was the “agreement under which [Mr. Brandt] accepted the position” at the LCBO.

“The living allowance was provided given he has a permanent residence in Sarnia and that his job requires him to be in Toronto and the job is temporary in nature.”

Mr. Kennedy said the LCBO’s position is that the living allowance does not have to be disclosed under the Public Sector Disclosure Act, “otherwise it would’ve been.”

“From the LCBO’s perspective, it is not a taxable benefit, therefore it is not reflected in Mr.Brandt’s T4 slip.”

… It appears the LCBO’s interpretation of the Income Tax Act is at odds with the Canada Revenue Agency. “Whenever an employer provides you with money to pay for a place to live, it’s a taxable benefit, that’s it, that’s all” CRA spokewoman Colette Gentes-Hawn said.

Mr. Kennedy confirmed the board also provides Mr. Brandt with a luxury automobile to commute between Toronto and Sarnia on most weekends…

… Mr. Kennedy defended Mr. Brandt living allowance, noting Mr. Brandt’s “salary is, as you know, less than many, many other people.” According to provincial government figures released last week, Mr. Brandt’s 2003 salary was $139,116, which is less than that of 34 LCBO employees. When asked how common it is for Crown corporation CEOs to have their accommodation paid for, Mr. Kennedy responded “I don’t know – you’ll have to look into it.”

Spokespersons for TV Ontario CEO Isabel Bassett and Ontario Power Generation CEO Richard Dicerni said neither receives a living allowance or use of an automobile…

[Josh Oakes]

Note to taxpayers: This type of pork-barreling doesn't exist when alcohol distribution is privatized. I don't mean halfway, we're selling the LCBO so only a large corporation can control distribution privatized, either. I mean anyone who wants to open a beer store can if they want to privatized. Do it. I'll give you a jaw-dropping assortment of beer and you won't have to pay one penny of my rent.

Isn't it time we stopped paying the LCBO to screw us?

[Rob Creighton]

Yup, I agree. Where do I sign?

[borderline_alcoholic]

No, you're looking at it all wrong. The key is to find a way to convince the LCBO to pay for *our* living expenses too. After all, this is an organisation notionally working for our benefits.

It sounds as though there is already a vacancy for the position of "chairman of the Workplace Safety and Insurance Board" and the CEO position may be available shortly. Move quickly everyone. I am sure that we can find some other mechanism by which to continue this practise "reasonably legally" and there are bound to be plenty of other "perks" that remain unknown by the public. Long may it continue.

Woo hoo!

[borderline_alcoholic]

I suspect that when the dust has settled on the whole scandal aspect, and a few people have taken the bullet and resigned (with full pension and a sudden random leaving bonus, plus the likely promise of a lucrative consulting position a couple of years later when this whole dirty business is forgotten), we will see the scheme adjusted in something like one of the following ways:

1. The LCBO buys a couple of Condos for their senior staff to stay in (rent free, of course) when they need to be in the city.

If this option proves to still be unworkable with the tax people then option 2 comes into play:

2. They raise the living expense allowances to include the amount that will be paid in tax.

Additionally, maybe the CEO should be offered a salary increase or at least a bonus to recompense him for the stress of this whole business, which has come about entirely due to a failure within the legal and accounting departments. You cannot really blame the poor CEO for this and such a scandal might mean that he might be considering leaving, a quick increase in remuneration might persuade him to stay...

Problem solved. Business as usual can continue. We apologise for the slight disruption to your service. Etc etc.

I wonder if the LCBO needs any advisors... Hmmm... Some phone calls to make.

[DukeofYork = Richard]

In all seriousness, this has got to be the least of my worries. Especially if the living allowance was something agreed upon at time of signing. What about the fact that 34 LCBO employees are making more than him? Who are they??? What the hell are they doing?

[dhurtubise]

This is a fairly common practice (paying out a living allowance for jobs of temporary nature) in the private (and public) sector. And, wether this guy talked to a Canada Rev. spokesman about or not, any company can easily justify the expence as it would be rather easy to spend 2500$ on hotel lodging and food for their employee on a monthly basis.

What makes it a little tough to swallow is that this temporary job has been kept since 1991 (13 years) which is a heck of a lot longer than the averge stay of employees in most jobs. Plus this lucky guy probably ended up with a 300,000$+ condominium in his name at the end.

[A]

First of all, if you dont think this happens in private institutions you're crazy. Golden Parachutes for underperforming CEOs are the norm, not the exception.

Secondly, the guy is only making $125K, which really is chump change to be the CEO of a $9B revenue company.

[rabbit]

CEO my ass...in name only...this political hack knows nothing about retaling that his subordinates haven't told them so let's not pretend for a minute that he should be paid what a real CEO should be paid. He's a political operative who was paid off for years of service with a great job where he's flown to the Caribbean by Bacardi for golf and wined and dined throughout Europe and he doesn't make a single real decision about what the LCBO is doing.