7 July 2006 Mr. Robert J. Pellatt Commission Secretary British ...

British Columbia Utilities CommissionInformation Request 1.42.2Dated 19 June 2006British Columbia Transmission CorporationResponse Issued 7 July 2006British Columbia Transmission CorporationTransmission Revenue Requirement Application42.0 Reference: Exhibit B-1 Section 9, pages 158-159 – M&P F2007 SalaryRESPONSE:Figure 9.6-4 provided a comparison of M&P’s salary scales in comparison toTowers Perrin’s Power Services Industry survey which suggested that M&P salaryscales will need to be adjusted by 2% in F2007 to maintain the salary scale midpointsat the targeted market position.42.2 Please file comparisons used from Towers Perrin’s Power ServicesIndustry survey which supports the requirement for a 2% salary increasefor M&P in F2007. What does the 2% salary increase represent in costsfor F2007?Attached is a larger scale version of Figure 9.6-4 which better shows the separationbetween the Market Median line and the BCTC Control Point line (mid-points of BCTC'sestablished salary ranges).The Market Median line is derived from data provided by Towers Perrin and represents acalculated single market median rate for an underlying cluster of actual market mediandata points for benchmark jobs within each salary grade (see table below). For F2007BCTC compared 36 jobs to market which collectively cover approximately 70% of BCTC’sM&P workforce. The calculated market median rates for each job group (72 through 79)are compared to BCTC’s salary scale mid points (BCTC’s control points for salarymanagement) in order to determine the adjustment, in this case 2%, to bring the BCTCsalary scale control points to the calculated market median.Please note that a 2% salary scale adjustment does not directly result in a 2% “salaryincrease”. BCTC adjusts individual salaries through a separate process which linksindividual salary adjustments to a combination of performance assessment and theposition of an individual’s salary relative to the mid point of the appropriate salary scale.Please also see the response to BCUC IR 1.42.3.It should also be noted that the market data provided by Towers Perrin and used byBCTC to determine market median comparisons is subject to a confidentiality agreement.