About 98 per cent of eligible managers in the Ontario Public Service received bonuses last year, despite assurances from the cash-strapped government that it's serious about freezing pay in the broader public sector.

The controversy over awarding bonuses when the province is awash in red ink was revived this week when the head of eHealth Ontario returned his hefty bonus after it was reported by The Canadian Press.

Greg Reed, CEO of the provincial agency, received the $81,250 bonus on top of his $329,000 salary in June. He offered to pay back the money after coming under heavy fire from opposition parties.

'They are incompetent and they — I'll put it nicely — bend the truth when they talk about what they're doing and how they're doing it."—Progressive Conservative Peter Shurman

According to documents obtained by The Canadian Press, about 8,700 of 8,900 eligible civil servants received performance pay in 2011, costing the provincial treasury $35.6 million.

The documents, obtained under freedom of information laws, said the highest bonus awarded to a manager was 12 per cent of his or her pay, while the lowest was 0.46 per cent. The average was 3.6 per cent.

"It's shocking, but not surprising," said Progressive Conservative Peter Shurman.

Taxpayers who are trying to get by on less pay should be outraged, because those numbers don't reflect what's happening in the private sector, he said.

Some argue that performance pay helps retain talent, but you don't need to hand out bonuses to nearly all eligible employees to make them stay, Shurman said.

"We are not just in tough times, we're in critical, crisis times here in the province of Ontario," he said. "And to be paying out bonuses as high as 12 per cent…is outrageous in these times."

The governing Liberals are sending mixed messages by allowing OPS managers to get bonuses while demanding a wage freeze from teachers and other public sector workers, said NDP Leader Andrea Horwath.

Premier Dalton McGuinty has threatened to impose a new contract on Ontario teachers to freeze wages if they don't sign new agreements with school boards by Sept. 1.

"It shows once again that the Liberals are saying everybody has to be frozen, but some people have to be more frozen than others," Horwath said.

"It's a shame that they continue to pit groups of people against each other."

The government wouldn't disclose employee-by-employee numbers, saying it's the personal information of individual employees.

However, the names of those making more than $100,000 are disclosed on the province's annual "sunshine list" of top public sector pay.

Sunshine list growing

The list has grown steadily over the years. There were about 78,910 names on the list in 2011, up 10 per cent — or 7,432 workers — from 2010. In 2009, the list contained about 64,078 names.

The government said employees who received a bonus had their salaries frozen, which has saved the province $34 million since 2009. The total cost of performance pay has also dropped by 30 per cent since 2009.

"There is a pool from which the managers get paid based on how they have performed," said Government Services Minister Harinder Takhar. "So that pool has actually gone down."

Bonuses are part of the pay package for managers and is only awarded to those who meet their performance commitments, ministry spokesman Alan Cairns said in an email.

The governing Liberals have rescinded bonuses before. In 2011, Health Minister Deb Matthews told eHealth to cancel raises of up to 1.9 per cent and promised bonuses of up to 7.8 per cent. Employees of eHealth have since launched a class-action suit to recover them.

The bonuses to civil servants call into question how serious the Liberals are about freezing compensation for public sector workers to help eliminate a $15-billion deficit, Shurman said.

"These people are completely incapable of management," he said. "They are incompetent and they — I'll put it nicely — bend the truth when they talk about what they're doing and how they're doing it."

The Tories say they want legislation that would impose an immediate pay freeze on all public sector workers.