Premier's interference steers B.C. Lotteries wrong way

Investors get nervous when a company director becomes so concerned about its direction that he resigns.
Directors are usually onside, or they leave quietly when their term ends. If they bolt, it's considered bad news.
John Bell has just bolted. He resigned as a director of the B.C. Lottery Corp. last _week. Bell, a consultant, was among the B.C. Liberals' early appointments to the board back in 2001, in the months following their election win.
Bell says his resignation wasn't related to the devastating B.C. ombudsman's report on the failure of both the lottery corporation and the government to protect customers from fraud.
"I am leaving the board due to differences of opinion subsequent to the report's release.," he said in a news release.
Which leaves a couple of likely explanations. Either Bell disagreed with the board's decision - made under some political pressure - to fire corporation CEO Vic Poleschuk in the wake of the report.
Or he balked at the board's willingness to hire an interim CEO pushed on it by Premier Gordon Campbell.
It's tough to see how Poleschuk could have stayed, given the ombudsman's report. It found a failure to establish procedures that would protect people who bought lottery tickets from fraud; a lack of meaningful response when people raised complaints; and an empty, misleading response when the problem became public last fall.
Though then again, it's tough to see how others in government - including Solicitor General John Les - have kept their jobs. The failure of the Gambling Policy and Enforcement Branch to do anything about the problem over the last five years is just as serious. And the branch was just as misleading in its response to the initial reports of fraud risk.
If Bell has concerns about the choice of an interim CEO, they would be justified.
Faced with a major crisis and the need to re-establish public trust, the board should have been looking hard for an interim CEO who would take on the job without any baggage. Maybe a retired corporate type from outside the gambling industry.
Instead, it picked Dana Hayden, who had been Premier Gordon Campbell's deputy minister of strategic policy. Campbell said he had suggested the board hire her; the board apparently considered a suggestion from the premier a pretty good recommendation.
Hayden has a good reputation and she has held senior positions under both the NDP and Liberal governments in her 23-year career in the B.C. government.
But it is a bad hire for a board serious about regaining the public trust.
Just as it shows poor judgment for the premier to have influenced - or instructed - the board to hire someone from his office. The Liberals have made much of the need for independent directors, managing Crown corporations free from political interference. Now, the premier has ignored the principle with the kind of appointment he would have fiercely condemned in opposition.
Campbell points to Hayden's past experiences as CEO of the Crown Agencies Secretariat, the government branch that oversees and supports B.C. Lotteries and other government-owned companies. But that's a negative under the circumstances. These problems developed despite the role being played by the secretariat.
More critically, the lottery board's responsibility is to fix the serious problems identified by the ombudsman and restore fading public confidence in the gambling industry in B.C. That means rooting out the past problems, identifying weaknesses and fixing them.
The premier's interest - inevitably - will be seen as being focused on minimizing political damage from the scandal.
So it doesn't matter how Hayden approaches the job. The fact that she worked in the premier's office and was Campbell's choice creates a damaging perception.
The public's confidence in the B.C. Lottery Corp, is critical. Without it, the government's plan to create more gamblers and persuade them each to lose more money won't work.
And its first steps in the wake of the lottery scandal are taking it in the wrong direction.
Footnote: The next item tough day for the board will likely come when it reveals whether Poleschuk receives a severance payment that could reach $500,000. The corporation has said so far no decision has been made. But if the money gets paid, expect some tough questions about why an executive who has been terminated is eligible for a payout.