Children’s Aid Society CEO expensed unauthorized travel, received out of line $273K salary, provincial probe finds

Rav Bains heads an organization that protects some of the most vulnerable young people in Peel. A severely critical investigation report for the government of Ontario raises doubts about his suitability for the job as CEO of Peel Children’s Aid Society.

The investigation commissioned by the Ministry of Children, Community and Social Services exposed a history of disturbing mismanagement and a lack of accountability under Bains’ leadership, including behaviour aimed at misleading the organization’s board of directors.

“There are no metrics or performance indicators that assess the degree to which the CEO is operating within the General Executive Limitations (EL1 ): ‘The Chief Executive Officer shall not cause or allow any practice, activity, decision or organizational circumstance which is either imprudent or in violation of commonly accepted business and professional ethics and applicable laws’ and (BCE01): ‘The Chief Executive Officer may not perform, allow or cause any act which is contrary to policies and Executive Limitations’,” the report, released last week, states, detailing the complete lack of accountability to prevent Bains from violating basic principles of good governance.

A provincial investigation report shows mismanagement at Peel's CAS (Isaac Callan-The Pointer)

For a trip to San Francisco on August 9, 2019, Bains used another employee’s credit card to charge $1,043 to the taxpayer-funded organization. The use of another staffer’s credit card (the director of people and culture’s Visa) meant the Peel CAS board was not alerted to the expense and did not sign off on it. Only after the provincial review was launched did Bains reimburse Peel CAS for the cost of his travel, which he kept from the board by using the Visa issued to a subordinate.

“The CEO should not use other employees’ Society credit cards,” the report says. “This results in the Board not signing off on CEO expenses per Delegation of Financial Authority (DOFA) and the CEO would be approving their own expenses.”

Not only did Bains’ trip get funded through a back-door mechanism that bypassed the board, but the travel itself was ineligible to claim as an expense. According to the report, “any out of country flights must be paid by employees” and are not eligible for expenses. Bains only repaid the cost of the flight in 2021; it is unclear if this was before or after provincially-appointed auditors began asking questions.

“Mr. Bains attended a training event in San Francisco in August, 2019,” Shane Vieira, Peel CAS’ director of communications, told The Pointer, but he provided no details about the training or explanation for why a Peel-based, provincially funded children’s aid organization would get training in California. There is no documentation to show the travel was work-related.

Vieira, who answers to Bains, offered explanations that make little sense, suggesting the use of a subordinate’s CAS credit card to book Bains’ flights was appropriate, even though he has his own issued credit card that he’s required to use so the board can review and authorize his expenses.

“The training and transportation fees were booked together on his behalf using the human resources credit card intended for training purposes. While the expenditure would have been appropriate if originally billed to his corporate credit card, Mr. Bains decided to personally reimburse the expenditure when the administrative error was brought to his attention.”

Vieira's misleading characterization does not hold water. Asked how the expense could ever have been “appropriate” given the out-of-country rules, he said only the cost of training should have been claimed. Bains never reimbursed this cost and only repaid the travel expense almost two years later, after the probe was launched.

“While the training related expenditures would have been appropriate if originally billed to his corporate credit card, Mr. Bains did reimburse the transportation related expenditure when it was brought to his attention,” Vieira said, failing to address the travel rules that forbid expensing trips outside the country.

Peel CAS is funded by taxpayers to look after the region’s most vulnerable young people (Isaac Callan-The Pointer)

The report highlights how Bains appears to have hidden concerns from the board and the public, despite staff complaints about the CEO’s conduct that have come to light in recent years, and which prompted the ministry to intervene.

“There is no evidence in the Board meeting minutes for the period from January 2018 to the present of discussion of risk management. There are no reported areas of weakness, problems or conflicts within the organization and no mention of any legislative changes that could have a material effect on Peel CAS.”

The minutes show board members were either not even informed of the mounting problems, or if they were, public minutes did not indicate this.

The minutes don’t even include any mention of the ministry review, in response to troubling allegations of mismanagement within the organization, despite clear communication from the Province to Bains and his organization about the government’s plan to investigate.

Another alarming example was Bains’ failure to be transparent around legislative governance meant to ensure accountability related to his own compensation, which has spiked way beyond where it should be.

Minutes of board meetings include “no mention of Bill 124 passed in 2019, the Government’s control mechanism for public sector salaries,” which capped most public sector compensation increases at one percent annually for a “moderation period” of three years.

The investigation report shows Bains is the highest paid CEO out of five comparable Children’s Aid Societies and has seen his personal compensation skyrocket by 30 percent since 2015.

The report raises questions about whether Bains violated the provincial legislation meant to protect taxpayers from abuse by public sector administrators.

“The CEOs salary is 29% (or $60k) higher than the average comparator salary,” the report states.

From 2018 to 2019, Bains’ remuneration increased 8 percent, rising a further 8.6 percent from 2019 to 2020, according to Ontario’s public sector salary disclosure list (commonly known as the ‘sunshine list’). Last year, Bains received $272,824 including more than $8,500 in taxable benefits (possibly for a car allowance).

“While these topics may have been raised in ‘In Camera’ sessions, summaries of decisions taken ‘In Camera’ should be recorded in the more public meeting minutes. The absence of any of these topics, together with the fact that all metrics on strategic accomplishments show all progress as either ‘as expected’ or ‘better than expected’ with no indication that any performance falls short of expectations, indicates a lack of comprehensive reporting to the Board,” the investigation report states.

The Peel CAS board did not respond to questions sent through Vieira asking if Bains would be disciplined or told to resign.

Lavish pay increases for senior staffers at Peel CAS are the backdrop to its issues of financial mismanagement. Increases have been well above the rate of inflation and significantly higher than pay rises for unionized workers. It is unclear if the organization is explicitly contravening the provincial legislation designed to rein in the public sector.

Peel CAS’ website lists nine staffers within its senior leadership team who work directly under Bains and are tasked with the welfare of children in the region. Senior leadership at the CAS is made up of CEO Bains, five department directors and a further four service directors. These staffers have enjoyed handsome pay rises that should be limited under the legislation.

“Several executive staff received salary increases of greater than 2 percent year over year,” the report says. “Some Director positions were reclassified which resulted in increases greater than 4 percent. These classifications were approved by the CEO.”

The lowest increase among senior leaders, based on the sunshine list, was for Brenda Moody (strategic intelligence) at 3.5 percent and the most significant for Chima Nsitem (parent and child capacity building; diversity, equity and inclusion), who received a promotion in 2019 and works a dual portfolio, splitting his time between equity work and capacity building. Nsitem’s salary rose 22.5 percent in 2020 and 20.3 percent the year before, ending 2020 at $165,089. His salary still sits below some of his service director colleagues, despite the promotion and dual portfolio.

Marino Cader (finance) has received generous compensation increases in the past four years. Cader’s salary, not including taxable benefits, as the director of finance and corporate resources in 2017 was $131,789, and by 2020, under the same job title, it was $176,755. That’s a 34 percent increase in three years, an average salary jump of about 11.3 percent a year, about seven times the rate of inflation in Ontario over the same period.

“The ministry does not get … involved in the HR or compensation matters of children’s aid societies, but expects children’s aid societies to comply with all applicable labour laws and wage restraint legislation,” a provincial spokesperson wrote in an email to The Pointer. “The comprehensive review report includes a recommendation to the society to assess its recent compensation increases to employees for compliance … and the ministry expects the society to address this issue in its workplan.”

Peel CAS’ training expenses are also double those of its comparators. Investigators found a number of instances where training costs had been claimed and recorded with “no record of what the actual costs related to”.

A sampling of senior management expenses indicated “a couple of instances” where staff claimed for meals that exceeded the $45 per day limit.

“The ministry expects that agencies that receive government money spend it for the purpose it was intended, in the best interest of taxpayers and consistent with the current fiscal environment,” a provincial spokesperson told The Pointer.

The future of the organization’s management is now uncertain, after the release of the scathing report, which was conducted for the Province under the leadership of the Osborne Group, a company that does a range of work in the public sector.

Bains finds himself in a difficult situation, tasked with a crucial role to maintain one of Peel’s most critical social safety nets, while staff and some in the public continue to question his leadership, particularly around issues of anti-Black racism, which sparked the probe and which the report also addresses.

With an explosive provincial investigation now confirming many of the concerns, his own future hangs in the balance.

Bains manages considerable public resources to complete the CAS work, and the buck stops with him on key decisions around how the organization operates.

The investigation shows Bains has presided over a financial mess at Peel CAS. Senior leaders have been handing themselves massive pay bumps that go against the goals of provincial legislation, while the costs of training and publicity are double and triple, respectively, the figures spent at comparable CAS organizations.

“The Society should put appropriate controls in place” to ensure policies are adhered to, the report’s authors write. “All expenditure policies must adhere to Ministry directives and guidelines. The Society needs to ensure proper approvals are documented.”

The financial issues that are highlighted came to light after a series of issues were raised by staff around the way Peel CAS treats Black children and staff who believe their experiences have been marginalized by the organization, largely due to Bains’ alleged unwillingness to bring about change.

A union-led series of counselling sessions with Black staff last summer culminated in a review that showed Black staff struggling at Peel CAS. The document said staff believe the organization’s human resources department “weaponizes its power” against Black staff, while senior leadership is “afraid to name anti-Blackness as an issue”.

In February 2021, the ministry stepped in and ordered its own review. A document produced by two third-party consultants and six ministry staff found a “seriously troubled” workplace where a top-down leadership structure is marginalizing staff. It also revealed troubling issues around senior leadership, specifically Bains, and the management of public funds for the CAS. 

Bains claimed an unauthorized trip to San Francisco, which he charged using a subordinate's CAS Visa (avoiding scrutiny), in his expenses. (Image from Maarten van den Heuvel/Unsplash)

The investigation shows Peel CAS does not conduct senior management performance reviews. There is no documentation to justify why a particular non-union employee receives a pay increase and the lack of evaluation of senior staff has created a culture devoid of accountability among leadership.

“In the absence of performance appraisals, it is difficult to understand how compensation increases can objectively be determined,” the report says. “This is also one way in which succession management can be planned. Reviews will increase senior management engagement.”

Investigators also revealed that key staff claimed to be unaware of legislation designed to curb out-of-control pay increases. In May, The Pointer sent detailed questions to Peel CAS about provincial salary cap legislation that was introduced with much fanfare by the Doug Ford PC government in 2019.

“Compensation provided at Peel CAS for all positions is comparable to other local CASs and not-for-profit organizations,” Vieira claimed in May.

That statement was partially confirmed by the review. “The average 2020 Director salary at Peel… is within range of $143,931 to $201,219 of comparative societies,” it says, but points out how out of line Bains’ compensation is, making about $60,000 more than other CEOs at comparable CASs.

Rav Bains speaks to MPPs (Image from Twitter-Rudy Cuzzetto)

Specific Ontario legislation was designed to control public sector wages, including spending at CAS organizations.

In November 2019, Bill 124: Protecting a Sustainable Public Sector for Future Generations Act, became law. The purpose of the law was to curb public sector salaries so that increases “reflect the fiscal situation of the Province”. It established a three-year period during which salary increases were to be limited to one percent per year, which was below the rate of inflation at the time.

“The Finance and Audit Committee of the Board of Directors, in a discussion with the reviewers, explained that they were not aware of Ontario legislation Protecting a Sustainable Public Sector for Future Generations Act 2019 which limits compensation increases for staff,” investigators wrote. “Children’s Aid Societies are specifically mentioned as organizations affected by this legislation.”

Even if leadership was unaware of the legislation, common sense and a basic respect for the taxpayer should have guided decisions on executive compensation. Instead, the people who controlled the public purse within the organization made sure they were lavishly taken care of.

It is unclear what action, if any, Queen’s Park will take. Before the pandemic, Ford’s government made public spending its key issue and has frequently blasted abuse and misappropriation of public funds. With an election less than a year away, the Progressive Conservatives are likely to continue to push responsible public sector spending as a key policy plank.

Vieira is adamant that Peel CAS has not broken any rules. He said the three-year pay-freeze period would begin on April 1, 2023, for non-union employees of the organization. It is unclear if this is correct or if Peel CAS’ salaries are being deliberately increased before that deadline, especially in the context that finance staff claim not to be aware of the rules.

“The agency is in compliance with Bill 124: Protecting a Sustainable Public Sector for Future Generations Act,” the director of communications wrote. 

The investigation addresses concern that this may not be the case.

It recommends: “The Board become familiar with the requirements under Protecting a Sustainable Public Sector for Future Generations Act, 2019 and assess against its compensation increases to employees since the legislation came into effect in 2019. The Board should also be aware of the consequences associated with non-compliance with the legislation.”

Email: [email protected]

Twitter: @isaaccallan

Tel: 647 561-4879

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