Thursday, 18 July 2013

SECRECY AND THE NALCOR STATE

The following comments are not mine, though they mirror the views expressed in The Nalcor State: A Clear and Present Danger.  Comments get placed on Uncle Gnarley Blog or arrive by private email.  

The words speak to frustration with a Crown Corporation engaged in high level secrecy and obfuscation and to a bewilderment as to why an elected Government is complicit and approving of  Nalcor’s behaviour.  Equally, there is the realization that, while the Government is blind, the public is offered no protection because Muskrat Falls is exempt from review, even from an independent regulator like the PUB.
In the coming days, I will have more to say about Nalcor.  I am very sceptical of those whom Premier Dunderdale refers to as the “experts”.  I generally find that 'experts' are confident, capable people and are more, not less, likely to demonstrate their skills and display the limits of their capacity to accomplish their mission.  Because Nalcor is a publicly owned Agency, there is an obvious expectation that they will also demonstrate how they will to protect the public interest, recognizing that every dollar spent is public money. Secrecy is the last thing this Province needs regarding Muskrat Falls.

For this instalment, you will see that other members of the public also feel a need to be constantly on the trail of Nalcor.

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During the 2013 AGM Ed Martin received questioning from Jim Morgan regarding the value of the SNC Lavalin Contract. Ed Martin refused to disclose the value, citing commercial sensitivity. Jim Morgan challenged Ed Martin lack of disclosure on the contract value. Jim Morgan was right. There is no reason to not disclose the value of this contract. It is not abnormal in industry to disclose contract values. If Nalcor adhered to the publically tendering process, the values would be required to be disclosed. Furthermore, SNC Lavalin as a company do not seem to have an issue with public announcement of contract values. A short internet search revealed the following:
1. Mine Tailings Project in Chile http://www.snclavalin.com/news.php?lang=en&id=1876
2. Power Plant in Poland http://www.snclavalin.com/news.php?lang=en&id=1950.
3.Transit Line in British Columbia http://www.cbc.ca/news/canada/british-columbia/story/2013/01/29/bc-evergreen-contract-snc-lavalin.html
4. Mining Project in Panama http://www.newswire.ca/en/story/1139437/snc-lavalin-debooks-cobre-panama-project

Therefore the question must be asked if there is a standard clause in Nalcor’s form of contract which precludes public disclosure of contract values? Was this implemented by Nalcor, or at the request of SNC Lavalin? Who does not want this information disclosed to the taxpayer and why?

All of this brings me to the biggest question of all. The entire project will be recovered in the rate base of the island consumer. The budget has not been approved by the regulator, and there is no oversight provided by the regulator. The shareholders are unable to get access to information. I would suspect that calls by the opposition in the House of Assembly would return similar results. Who are minding the gatekeepers?

Signed: Anonymous

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From private email:

Jim Morgan asked about SNC Lavalin, how much money are they being paid. He asked is it $50 million which is what he understood was the figure given at last year’s AGM. He was told that the figure is higher than $100 million. I also asked questions concerning this “cost-plus” contract, specifically what percentage commission they are charging for their management, engineering and procurement contract. Ed Martin refused to answer, saying the information is all commercially sensitive. He won’t tell us the amount or the percentage. He won’t tell us if the percentage is in line with industry standards for project management. Is it ten percent, 20 percent, 50 percent?  Ed Martin is not going to tell us. We don’t need to know. We have to trust that Nalcor is acting in our best interest and protecting us. How many of us are prepared to offer Nalcor our blind trust on faith alone?

Danny Dumaresque made a reasonable request for the following information on all projects exceeding $50,000 each: estimated cost, value of bids received and value of project awarded, along with the identity of the bidders, including the winning bid. Again, this information was refused as being “commercially sensitive”. It is interesting to note that the disclosure practices of the provincial government (transportation, public works, etc.) are more open than those of Nalcor. In fact NL Hydro discloses more information on its various tendering activities than does Nalcor, its parent company, on Muskrat Falls. The response to questions, sent to Nalcor, in advance of the AGM and are totally inadequate (yet)…. Nalcor is getting away with this and patting itself on the back (as if) no questions were left unanswered!!!!

Signed: David Vardy

Former Clerk of the Executive Council
Former Chairman, Public Utilities Board

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These views require no additional editorial comment.  Perhaps, others will express their own. If you have a contrarian view, you may wish to share it, too; all views are welcome on Uncle Gnarley Blog.

Look for additional Posts, relating to Nalcor, in the coming days. 
 
Des Sullivan
Uncle Gnarley Blog
 

1 comment:

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