With news of University of Calgary president Harvey Weingarten’s $4.75 million pension raising eyebrows across campus, the auditor general cautions there may be more to come when he releases his annual provincial audit in October.
The amount of Weingarten’s pension emerged Monday, along with news the numbers were left off the books for six years.
“I was very disappointed that I was not informed of this entitlement,” said Albertan Auditor General Fred Dunn. “I will speak more of my disappointment in the release in October.”
Jack Perraton, chairman of the U of C’s board of governors, said an error was noted in 2007 when discussions with Weingarten about his contract were underway and the problem was made known at the time.
Now that the president is retiring his pension can be calculated more definitively, resulting in the current $4.75 million figure.
“The amount was reflected in financial statements of the obligation [to the president], just the reality was the amount reflected was not sufficient,” said Perraton of the situation.
Dunn said initially the pension numbers were not included in the books and when they did start to appear, they appeared inadequately. He pointed to note 16 of the university’s Consolidated Financial Statements for the year that ended March 31, 2009, a document that outlines how the numbers were restated.
According to the statement, “the actuarial valuations and extrapolations performed in all the preceding fiscal years did not include this 22 years of past service.”
The statement re-measures the president’s pension to include the past service, which refers to Weingarten’s time as a professor and administrator at McMaster University prior to coming to the U of C in 2001.
Based on the restated numbers, the president’s non-cash benefits go from $180,000, as previously reported in March 2008, to $347,000.
Perraton said as part of the recruiting strategy at the time of Weingarten’s hiring it was agreed he would receive a pension based on his time at McMaster.
Perraton described the circumstances in 2001 as “fair and reasonable to attract a very talented individual to the university.”
McMaster will contribute nothing to the pension, which Weingarten will receive as an annual amount paid to him over his life.
“I understand it’s a huge number, but stretched out over a long period of time it’s not. It’s fair compensation for someone of the caliber of Dr. Weingarten,” said Perraton, who also noted a higher salary and higher pension would be received by someone in the private sector.
AUPE local 52 chairwoman Shirley Maki is of a different opinion.
“I was shocked and dismayed at the dollar amount in this time of economic rough times,” said Maki, who’s union represents support staff employed at the U of C. “To have one person who is able to receive that kind of money taken out of a budget that is struggling to make ends meet feels very wrong.
“There are cuts that are happening, you know it raises a lot of questions in our minds as to why the cuts are happening.”
In July, Weingarten announced 200 job cuts to the University of Calgary business unit to begin this fall, citing a $14-million deficit at the institute.
“We are required to live within our means and that’s what we are trying to do,” said Weingarten in a summer interview about the cuts.
Students’ Union president Charlotte Kingston said $4.75 million is a huge number to swallow, especially when many students are struggling to pay their tuition.
Kingston said Weingarten’s pension is part of a bigger problem.
“We can make a huge deal just around pension money, but really the issue is how much we’re paying all our executives,” she said.
“Obviously the president is not the only one making a huge salary and expecting a huge pension. We have a whole team of senior administrators making hundreds of thousands a year and their pensions will reflect that salary.”
Since starting at the institute in 2002-2003 Weingarten’s salary has grown from $269,000 to $441,000 in 2008-2009. During that same period the U of C paid almost $2.15 million in executive pay (including the president) in 2008-2009, a jump from $859,000 in 2002-2003. These numbers don’t factor in executive benefits, which totalled an additional $2.78 million last year.
As for concerns about fitting the large pension into the university’s budget, Perraton said the annual amount owed would not cause concern in relation to the overall budget of the institution.
Perraton said the missed numbers are an unfortunate error, noting communication of the pension obligation was made at the highest level, but did not get through in a manner that allowed it to be accurately accounted.
He noted additional safeguards and steps have been taken in order to see that a similar situation does not happen again.
Dunn, however, said he saw the situation not as a simple miscommunication, but a lack of communicating what is important and should be known.
As the university searches for a new president, it’s unlikely this issue will die down anytime soon.
Kingston said when a new president is chosen, it’s time to consider what a responsible compensation package consists of.
Perraton said in the search for a new president, the Board of Governors will make sure the university has the right leadership.
“We’re prepared to do what’s right to attract that leadership.”
With a file from Brent Constantin