Thursday, 22 June 2017


When the Minister of Natural Resources, Siobhan Coady, released the report of the Muskrat Falls Oversight Committee last Friday the first in fifteen months she tried to leave the media, and the public, with the impression that a new impetus was at work in matters of oversight.

The Minister was not being honest.

Given the evidence that, both prior to sanction and afterwards, the MF project estimates were falsified, it is reasonable to think that the Minister would not want to be mired in the deceitful culture that has grown up around Nalcor and her Department. But the Minister demonstrates no such caution.

It is one thing to say, as she has, that the government has questions about the project estimates, as did the whistleblower engineer. But a verbal expression of concern, alone, is not enough.

One might expect that Coady would not only want to know the origins of the alleged deceitfulness, and who is responsible, but that she might set new standards of disclosure for her officials to follow.

She has shown no interest in doing any of those things.

Monday, 19 June 2017


The latest poll from CRA does little more than reaffirm prior perceptions held by the public about the Premier and the Ball Administration.

The polling group found that 34% of decided voters supported the Liberals, 40% backed the PCs, while 24% stood behind the NDP.

Two other statistics offer confirmation that the Liberals are in deep trouble: satisfaction with the government stands at only 28%, while in leader preference Dwight Ball receives 23% support against 36% for PC leader Paul Davis and 16% for Earle McCurdy of the NDP.

The results essentially mirror those reported when Ball’s popularity dropped off a cliff last year.

Thursday, 15 June 2017


Guest Post by Kelly Populous

Imagine a law so badly misunderstood that politicians and parties tolerate an unwanted, unpopular premier in order to avoid an election. A government without the political capital to change important public policy becomes trapped with unwanted leadership and winds up paralyzed. The public grows more apathetic or, worse, angry... and the whole province suffers as a result.

The scenario would seem crazy if Newfoundland and Labrador hadn't already suffered through it under Kathy Dunderdale. Now, with Dwight Ball flailing badly as the province’s First Minister, it seems that we have lost the ability to determine a course to provide renewal of the province's political leadership. 

It does not have to be that way.

Monday, 12 June 2017


Waiting For Godot is a celebrated play by Samuel Beckett in which two characters, Valdimir and Estragon, are waiting for a person Godot who never arrives. The Ball Administration serves as parody for the tragicomedy. Like the government, as one writer says of Waiting For Godot, “the sheer emptiness and randomness of the plot causes the audience (or reader) to wonder if anything is going to happen”.

Ball and Coady especially resemble Valdimir and Estragon though possibly the tramps, Didi and Gogo, too because, like them, they seem to have no part to play.  

Our play departs from Beckett’s a little, but only because Coady can expect an appearance from the Auditor General, just not with the package she pretends he is carrying.

The Minister knows he will offer no guidance on the “falsification” issue over which Nalcor’s whistleblower has sounded the alarm. Her performance is simply the pretense that he will.

Thursday, 8 June 2017


"Falsification of information on a massive scale.” That’s what the Anonymous Engineer told the Uncle Gnarley Blog in January, 2017 about the estimates for the Muskrat Falls project.

The public now awaits follow through by the Premier and the Minister of Natural Resources on his call for a forensic audit. The audit would detail the origins and extent of the “low-balled” estimates and confirm whose signature(s) authorized their use.

In a conversation with him recently, the engineer reflected upon his disclosure and the response of the Government. Said he:

“Even though Minister Siobhan Coady has already indicated she accepts what I have said as part of the narrative and that she has questions, too, the Minister must know my warning was completely supported by the EY Interim Report, which the Government commissioned.”

Monday, 5 June 2017


If any member of the public as much as frowned last Monday when the Ball Government and Husky Energy announced agreement on the White Rose Extension project, they might have risked exile to the Funks or worse. Politicians, industry officials, hangers-on, the compradors (fixers and agents) and, of course, the media were all found ‘cheek to jowl’. 

Ditched, along with the champagne corks, was even the tiniest bit of perspective on the flawed deal even if, admittedly, it was an important one.

There is no question that the failure of OPEC to keep prices as high as Ed Martin had decreed, the end of the Vale and Hebron projects, and the consequent downturn in the housing sector, have everyone longing for the good “old” days. But economic challenges are not a time for governments to lose their minds, or embrace a future with a duration running only until the next election.

Siobhan Coady seemed within a nudge of shouting “we got it”, her restraint tethered only by the star of Galway who long ago appropriated the phrase with dubious claim.

The truth is the Premier and the Minister had only Husky’s ‘win’ to announce.  

Thursday, 1 June 2017


When malfeasance on a grand scale is alleged against senior government officials by credible people, what are we to make of it?

According to Stan Marshall, the decisions were directed at a senior level, but he says he doesn’t know who is responsible and doesn’t want to find out.

Yet the consequences are enormous. NL society has been laden with an unspeakable debt and a failed project, fallout from which will cause great social and financial pain over many decades.

The situation begs another question: do the authorities have an obligation to investigate and to hold the complicit to account, in keeping with the laws of civil society?

Is the Ball Administration’s seeming disinterest in the matter proof that what is still if only barely obscure should remain that way; that a higher standard applies to those wielding power?

We will return to this question. 

Monday, 29 May 2017


A bit of an odd story by CBC’s Terry Roberts, entitled No formal talks for ‘energy transactions’ with Nova Scotia says Nalcor (May 22nd), was seemingly intended to recognize the opportunity afforded Newfoundland by the impending completion of the Maritime Link (ML).

Roberts found Emera’s Rick Janega and Nalcor’s Stan Marshall in a celebratory mood about the savings opportunity available from “displacing costly Holyrood power by importing electricity from the Maritimes”.
The CBC story caught my attention because it has some understated and missing pieces.
The completion of the ML might result in some short-term savings for just three or four months. But by year's end, the Labrador Island Link (LIL) will be also be ready, if Stan Marshall is to be believed. This event will allow transmission to the Island of the unused portion of the Recall power from the Upper Churchill. But the commissioning will also trigger a levy on ratepayers for a large portion of the debt raised to build the Muskrat Falls project.

Tuesday, 23 May 2017


Some critics of the Muskrat Falls project, including this scribe, had hoped that the Auditor-General (A-G) might review the activities of Nalcor several years ago. Confronted directly on the issue, during a presentation on the province’s fiscal position at Memorial, the A-G excused his Office based upon a limited budget and a shortage of resources.

Then in November, 2016 Terry Paddon – with no evident change in those resources - suddenly got energized. He told the media he now planned “to take a look at Nalcor Energy (and) possibly Muskrat Falls."

The focus of the A-G has to be sharp and precise. In this instance to investigate the allegations of estimate falsification of Muskrat Falls.

In its Mission Statement the A-G’s Office states:

"As legislative auditors, we audit financial statements and other accountability documents, evaluate management practices and control systems, and determine compliance with legislative and other authorities.

Our purpose is to promote accountability and encourage positive change in the stewardship, management and use of public resources".

Contrary to the stated “Mission” there has not been any response from the Office of the A-G on anything.

Thursday, 18 May 2017


The CBC report of an anonymous senior Nalcor engineer - who claims that low-balled estimates were used to obtain sanction for the Muskrat Falls project - has, again, shed light on a Crown Corporation that, sometime after 2009, went rogue.

The engineer’s allegations are now well-known, but Nalcor’s response – specifically Anthony Germain's interview – finds a retirement-minded CEO indicating casual indifference to what can only be described as the most serious accusations ever leveled at the government since Confederation. 

The CBC quoted the senior engineer using the words “absurdly low” to describe the estimates. In my Blog Post of February 2017, the same engineer used the word “falsification”.

Nalcor CEO Stan Marshall described the estimates as “unrealistic”.

“Absurdly low”, “falsification” and “unrealistic” – any difference is fundamentally meaningless.

In this context it is important to remember that we are not discussing the replacement of a culvert in Bung Hole Tickle. Estimating a multi-billion dollar project is complex work. It also goes through multiple layers of review – each time by a group more senior. 

Monday, 15 May 2017



Close observers of things Muskrat are by now getting used to troubling news regarding this benighted project.

However, the most recent Uncle Gnarley posts building on revelations first made by a former Muskrat Falls project engineer (aka the Unknown Engineer) on UncleGnarley on January 30, 2017 must have shocked even the most cynical.

Seriously - are we talking about someone playing fast and easy with the numbers?

If true, would be big time shit.

Then came last Wednesday’s stellar CBC St. John’s Morning Show interview by Anthony Germain featuring the disguised voice of the “Unknown Engineer” repeating on the public airwaves his astounding assertions ending with a call for a “Forensic Audit” of the manner in which the Muskrat project costs were prepared.

The next day Mr. Germain followed up with an extended interview on the mechanics of a Forensic Audit with financial wiz Larry Short – all of which served to turn up the heat on this issue in dramatic fashion. 

Thursday, 11 May 2017


Guest Post by David Vardy and Ron Penney

Breaking news from the CBC casts new light on Muskrat Falls!

On January 30, 2017 Uncle Gnarley posted on the falsification of estimates, drawing upon allegations made by a Nalcor engineer, who said that

I could not put up with falsifying information anymore.To begin with, the original cost of $6.2 billion on which the project was approved was a complete falsification. The estimate was deliberately kept low — below $7 billion, so as to appear favourable relative to the cost of thermal power generation.

The likely costs were known about three years ago, but Nalcor Management kept it a secret, steadfastly denying that there were major schedule delays and cost overruns, until it was no longer possible to hide the true status with the election of a new Provincial Government.

Monday, 8 May 2017


First, I have to relate a little story which will provide some additional context to the purpose of this item. 

Back in October 2014, during the visit of Dr. Stig Bernander who came to the province to conduct field work along the Lower Churchill River, I woke up one morning to find the Association of Professional Engineers and Geoscientists of Newfoundland (APEGN) in pursuit of the Professor. The email read that APEGN was trying to contact Dr. Bernander so that the association could cite him for having used “P. Eng.” – the designation which is for the proprietary use of APEGN.

Evidently, APEGN had received a complaint from one of its members - following an advertisement I had posted in the Telegram. The advertisement was placed for the sole purpose of inviting the public to the Bernander Lecture scheduled for presentation at the LSPU Hall. The complaining engineer noted that Bernander had not registered with APEGN and was therefore unqualified to use the engineering designation.

Admittedly, I thought the email peculiar. After all, the octogenarian Professor had come here, pro bono, in response to an important public matter, the North Spur. I thought it rather ungracious – to say the least – that he should be tracked down so that a fee could be collected.

Thursday, 4 May 2017


Guest Post By James L. Gordon, P. Eng. (Ret'd) 
On May 1st, I read with mounting astonishment the aDB Engineering report dated April 20, 2017, on their investigations into the causes of the collapse, which occurred on 29th May, 2016.

The level of incompetence described in the report is so widespread that it brings into question the integrity of all other structures in the development. All staff, from carpenters to engineers are included within the ranks of the incompetent. The sub-standard construction was clearly visible to all, but nothing was done to rectify the errors.

The collapse occurred in the lower portion of the draft tube as shown on the following Figure1, copied from Figure 2 in the aDb report. In this area, the water passage changes from a vertical expanding cone to an almost horizontal expanding rectangle as shown in Figure 2. It is the most complex double-curved shape in the project and very difficult to build.
For small turbines, the shape is formed in timber, with an east coast shipwright engaged as the carpenter foreman. A shipwright carpenter is the only person capable of cutting and shaping the timber to the required complex shape.

Tuesday, 2 May 2017


The Bern Coffey debacle is mind-boggling. But it leaves two important facts exposed.

First, Ball approved the untenable arrangement with Coffey permitting him to continue his law practice. It is one thing to allow for a winding-up period, quite another for the Clerk of the Executive Council to be moonlighting - in a court of law where he would be obligated to argue against his employer.  

Second, just as the Government was taking some initiative to hold Nalcor to account, the brutally incompetent Crown Corporation has, again, been let off the hook as far as the MF Oversight Committee is concerned.

With Coffey’s intervention, the Committee had finally gotten two capable members. Likely, the appearance of three ‘naysayers’ on the Muskrat file was causing some people to sweat. Likely, Coffey was outed but he and Ball ought never to have afforded Nalcor - or the Opposition - that opportunity.

Now, the former Deputy Minister of Natural Resources under Dunderdale - who played messenger for Ed Martin, sending Nalcor's requisitions to Cabinet - is head of the Oversight Committee. Ball confirms, again, he is gutless.

Monday, 1 May 2017


Site C Hydro Project, B.C.
Hydro projects underway in British Columbia and Manitoba are making waves among observers, all drawing parallels with the Muskrat Falls project. While there are many similarities, the public should be careful in concluding that Muskrat is entirely their mirror image.

Each has origins inextricably tied to gung-ho engineers, compliant bureaucrats, and politicians unwilling to subject self-serving assumptions and overbearing risk to professional and objective review. This is bad enough, except Muskrat will be forever dogged by the deceit that underscored project sanction.

We’ll come back to that point, but others are also instructive.

Thursday, 27 April 2017


Nalcor V-P Gil Bennett
One worker was taken to hospital and seven others received first aid on May 29, 2016 when a major section of the formworks collapsed, during a concrete pour at the site of the powerhouse on the Muskrat Falls project. 

Nalcor V-P Gilbert Bennett promised a full investigation and report. One year later, Nalcor is still ragging the puck, although following some poking and prodding from this scribe there are signs that one is finally forthcoming.  

The report ought to have been on Gil Bennett's desk within at most 48 hours of the collapse. In the real world of construction not the one Gil inhabits, but certainly on the Hebron GPS (which reported no lost time accidents) real managers and their senior bosses demand no less. 

Monday, 24 April 2017


Just before Easter, the Minister of Finance and her officials laid out 65 pages of cuts to government expenditures. This was the result of a process known as "zero based budgeting" (ZBB), a process which requires justification for every individual expense. There is nothing inherently wrong with ZBB. Processes like this one have their place as long as their limitations are understood.

Anyone with a basic understanding of how government functions will recognize that it takes a great deal of work to perform ZBB on an $8 billion operation. While periodically necessary, if it is ill-timed it accomplishes little more than giving licence to the folks in the Treasury Board to "be busy being busy".

But it does give the public the appearance that the Minister has her "sleeves rolled up" — another euphemism for action with little purpose — and Bennett wants to create the impression that she is assiduously tackling the deficit.  

Thursday, 20 April 2017


The Ball Administration recently made four new appointments to the Muskrat Falls Oversight Committee. Two professional engineer Jason Muise and Memorial Economics Professor Dr. Jim Feehan are longstanding anti-Muskrateers, “naysayers” in the idiom of the Wiliams/Dunderdale era.

Now the Committee has three who tried their best to warn successive Tory administrations of Muskrat folly, including Bern Coffey the Clerk of the Executive Council, who is the Chair.

While those appointments seem a step in the right direction, for the present I am inclined to counsel caution that they actually represent a shift in the way oversight is performed.

Two others an accountant and a former bureaucrat were appointed along with Muise and Feehan.

The four joined the Deputy Ministers who have inhabited the Committee from the very beginning. Of course, the latter should only be ex-officio, available solely to give support to the independent members of the Committee.

Monday, 17 April 2017


How did 2.2 million m³ of sand and clay that lay atop the section of the lower Churchill Valley shown in the photo below disappear? The devastated one-square-kilometre site is located across from Edward's Island a short distance upstream from Muskrat Falls. Read on and you will find out.

Site of  landslide viewed across the Churchill River from Edward's Island
The North Spur stability problem specifically Nalcor’s refusal to submit its "fix" for independent review still rankles those who have followed the sad saga of the Muskrat Falls project. 

The current $11.7 billion price tag is its own testament to, among other issues, Nalcor’s incompetence. But its failure to take every precaution to ensure the dam’s integrity having been warned of the risks, having closed the door to expert analysis is another in its list of indictments.

The North Spur instability problem isn’t about money anymore that ship has sailed. But four years after project sanction, an independent assessment of Nalcor’s remediation plan still eludes. 

Thursday, 13 April 2017


Guest Post by James L. Gordon, P. Eng. (Ret'd)

I have mentioned several times that a review board is essential for the North Spur. 

Perhaps I should summarise the reasons particularly since the Owner’s engineering consultancy - Hatch - has made the same recommendation.

It is acknowledged that the North Spur natural dam is the first time a dam containing marine clay and founded on a deep deposit of marine clay has been used in a hydro dam. All major “firsts” always have a review board to add assurance to the design. I have worked on three dam “firsts” and all had review boards, and all benefited from their advice.

The first was at Duncan in BC, which is founded on a deep deposit of unconsolidated liquefiable silt. It holds the world record for settlement as predicted, at now over 6m. We had a 4-man review board which made significant changes to the project layout, adding to security.

The second was at Bighorn in Alberta, where the deepest (to date) cut-off through gravel and boulders was part of the dam. There we had a 2-man review board, including Dr. A. Casagrande from Harvard. He made a major change in the dam design which, on hindsight, avoided a possible dam failure.

Monday, 10 April 2017


The Jerry Earles of the world seem to be applauding their good fortune that the Ball Administration wimped out on the task of resolving our fiscal mess. Such prescience aligns completely with the agenda of the Tories and NDP. It remains a real and present danger to the province's ability to manage ourselves as a society. 

There are three fundamental problems with Cathy Bennett's second Budget. 

The first is that she has failed to tackle what she has described as a "culture of spending" which took root under the Tories.

Second, the Minister has aligned herself with the Great and Exalted Ditherer, the Premier, having used an all too tenuous increase in the price of oil to paper over a serious deficit and fast rising public debt. 

Third, having sidestepped any plan to rectify public sector mismanagement and bloat, the Minister reinforces a public view that the fiscal crisis is really not a problem - that the Tories were bad, but not all that bad. That is a dangerous proposition when the truth is otherwise.

Wednesday, 5 April 2017


Editor's Note: As the Liberal Government readies for their second budget, I would like to remind regular readers of the eight-part "Budget Colloquy”  posted by JM back in 2015. Although you can argue with some of JM’s recommendations, this series was well-researched and offers a solid analysis of the state of the province’s finances. JM now returns with an introductory post on the equalization issue. 

Guest Post by  "JM"

First, I must disclose that I am not an expert on equalization. It is a complicated federal program, which played a pivotal role in most of the history of the province. During the 90’s, equalization provided nearly 30% of the total revenue to the provincial government. The highest absolute contribution was $1.2 billion which occurred in 2001

In 1999 NL received over 12% of the total federal equalization allocation, for about 2% of the population of the country.  

By comparison, in 2016 we received no equalization and the province's combined revenue from other Federal sources ($702 Million) and from offshore royalties ($485 Million) was less than the 2001 equalization value alone, adjusted for inflation. 

As the second budget from the Ball government will likely attest, NL is in dire financial straits. After nearly a decade of hiatus, equalization is again back in the news. Dwight Ball wants to get back at the negotiating table for the next round of negotiations which occurs every five years. 

Monday, 3 April 2017


When the Ball government announced a cut of 93 positions in the health care system last week, for savings of $7.6 million, budget watchers expressed sympathy for the 56 employees actually let go but, otherwise, waited for the next shoe to drop.

And with good reason. 

Health care consumes 36% of an $8.5 billion operating account spending on the day-to-day operation of programs and services (source: Budget Update). $1.58B of that sum constitutes deficit the shortfall between cost and the revenues available to pay for them. The difference is financed by government’s borrowing program.

Health care’s proportionate share of the deficit this year alone amounts to $569 million. The sum is in addition to the borrowing done by the health Boards directly (several million) which only shows up on the government’s books in the “Total Debt”. And a full accounting of health care’s cost should include infrastructure the amount applied to the capital account. Putting those sources of health care deficit together you would discover a shortfall well in excess of $600 million per year. 

But, for the sake of clarity, we'll just stick with just the operating deficit.

It would seem sensible to assume that other sectors of government can’t absorb overspending by health care. So what does this mean for the health care system?

Thursday, 30 March 2017


Cartoon Credit: Anthony Rockel
Don’t waste your time reading the Liberal Government’s Speech from the Throne. It contains the ramblings of a group that can’t put one foot in front of the other.

That is unfortunate. If there was ever a time when the province needed a clear plan and someone with the ability to communicate it, it is now. In the last Speech from the Throne, the Government promised “decisive actions… with Budget 2016 followed by… medium and long term actions…” Those are still absent. Then, too, it has been a year in which fumbling from library closures to Ed Martin’s severance compounded by Ball's own incapacity for articulation, has left the government severely weakened.

This year it needed to be ready with a coherent document that presaged a Budget styled for crisis. It could muster no such a strategic focus.

Monday, 27 March 2017


Dr. Pat Parfrey
The number of people who turned out to hear well-known nephrologist (kidney specialist) and rugby coach, Dr. Pat Parfrey, kick off his lecture tour on behalf of a group called “Choosing Wisely NL” (CWNL) was far too small given that he had so many important things to say. 

CWNL, a program conducted by Memorial University's Faculty of Medicine in partnership with the Newfoundland and Labrador Medical Association, has been established to advance "the safe and appropriate use of health care resources," or what Parfey describes as the balance of benefits versus potential harms.

The small group of listeners belied the deepening concern over the financial crisis unfolding in our health care system, and its inescapable linkage with the even larger one facing the province. 

It is not often that the public, or even policy wonks, are treated to a blunt and politically unfettered chat about deep-seated problems and of an organized plan to fix some of them. But that is exactly what the long-practiced and straight-talking physician had on offer. Free of all the junk of professional ass-covering, the doctor’s frankness was refreshing.

Thursday, 23 March 2017


The sudden cancellation of Backtalk with Pete Soucy, one of VOCM’s much-heralded talk show hosts, represents a significant loss to the public affairs arena of this province.

At first one might think that the axing of the popular writer, actor, comedian, and teacher should be treated as just another change in the minutiae of operating a radio station, and that cancellation of one of three shows is not a matter for those outside of corporate media to bother their little heads over.

But that is not the case.

Underscoring this decision by Steele Communications, the radio station’s owner, is the huge void that exists in a province bereft of public affairs analysis. After all, VOCM does news as poorly as the other media.

Monday, 20 March 2017



Independent Dam Safety Review And Audit By Hatch
February, 2017

Guest Post by James L. Gordon, P. Eng. (Ret'd)

James L. Gordon, P. Eng.
I have read the "Hatch "Audit" released by Nalcor just a few days ago. The first issue that I noticed is that a company cannot “audit” its own work – it is a blaring conflict of interest, and I am surprised that Hatch accepted the assignment. Of course everything is perfect, why would Hatch say otherwise when commenting on their own work?

The second issue is that the report is limited to a review of the project management and operation – quote from slide 11 - “The objective of this presentation is to cover the results of a dam safety audit and overall review performed for the Muskrat Falls GS between January 29 – February 2, 2017” And – quote from slide 17 – “The review of the design of structures did not form part of this audit”.

So, the entire report can be deposited in File 13¹. Bearing this in mind – what is missing from the report? The immediate reply is no numbers! The entire report is based on the opinion of one geotechnical engineer, with no supporting documentation. I would have expected to see at least the following -