THE NALCOR STATE: A CLEAR AND PRESENT DANGER

Likely, most people believe that the Muskrat Falls Project is out of reach of cancellation.  That may be true; still, the public expects their Government to keep a tight rein on Project costs and to report frequently. 

So far, the Dunderdale Administration has shown no sign that it is either concerned, or that it even cares, whether the public is kept informed.

The Government has sanctioned Muskrat Falls based upon a series of dodgy and ever changing arguments.  But, having passed over complete discretion on how billions of dollars of public money will be spent, to a cabal of unelected bureaucrats at Nalcor, represents an unparalleled dereliction of duty, by elected officials.

The performance of Nalcor CEO Ed Martin, during its recent Annual General Meeting (AGM), is significant.  Russell Wangersky raised the issue in the June 30th edition of the Telegram.  He cited several specific examples of the Corporation’s refusal to disclose essential information regarding major Project contracts and expenditures. In a nutshell, Nalcor is making copious use of the “can’t tell you” strategy: it responds to many enquiries, with either “no answer” or “too commercially sensitive to answer.” As a backgrounder to this piece, Mr. Wangersky’s Column, "Variations on a theme - questions and non-answers", is well worth reading. 
The Provincial Government has functioned, for forty years, under strictures imposed by The Public Tendering Act. The Act was promulgated, under the first Tory Government, following Smallwood’s defeat.  The Smallwood era was notorious for its ‘cost plus’ contracts, awards to Liberal Party supporters and, especially, for the corruption that always accompanies secrecy.

The Public Tendering Act provides, more than a level playing field for contractors.  It eliminates favouritism to friends and partisan supporters; it is a system, when allowed to function, that finds essential integrity through the fundamental act of public disclosure. 

No contractor, whether a successful bidder or not, disputes that its name and bid price will become public knowledge.  This same information Nalcor now deems ‘sensitive’.  Obviously, Nalcor has never weighed the value of transparency as a fundamental underpinning of good governance.

Such deference to Nalcor began with former Premier Danny Williams and his relationship with CEO Ed Martin.  It has always been a mystery, to me, how a person plucked out of Petro Canada’s middle management could be made an instant hydro and megaproject Czar, given responsibility for billions of dollars of public money. That is another storey.

But, one thing is clear: Williams wanted an ‘energy powerhouse’ and he wasn’t about to ask the public its permission or inform them of the pitfalls of such a venture, financially or in terms of its impact on other public policies. Premier Dunderdale has never objected to Nalcor’s ambitions. But, then she has never boasted an original idea or questioned one of Williams’. 

This matter is not just about contracts and whether, by a fair bidding process, the public has received ‘value for money’.  It is also about the amount of money committed and spent, and how the expenditures relate to previously determined Budgets; it is about cost-overruns which, in this case, threaten the finances of the whole Province, it is about a host of technical issues, like the North Spur problem, markets for the surplus power and a host of other issues, to which the public has a right to have answers.   

The public may need reminding that when the idea of building Muskrat Falls was incubated, the Government, on their behalf, held to an arrangement that allowed 100% of the capital cost to be paid for, by rate payers, through a ‘take or pay’ contract, for only 40% of Muskrat Falls power. Revenue generated, if any, for the other 40%, (20% is given Emera for the Maritime Link) is destined for Nalcor’s coffers.  It is not designated to offset the high power costs of Nfld. rate payers. 

Of course, Nalcor has also been given a wide role in the Province’s oil industry, which has escaped much public discussion, too.   The upshot is that Government has permitted non-elected bureaucrats authority, not just to spend without disclosure, but to aggregate public money outside of Government’s budgetary process. 

One should rightly ask: has the Dunderdale Administration given de facto permission to Nalcor to act as “a state within a state”?  Whether by specific direction or passive acquiescence, has the Government permitted this Agency to bypass a public contracts system not even available to itself?

Given the high-handed approach by CEO Ed Martin, to legitimate citizens’ questions and concerns, it would have been a reasonable expectation, following Nalcor’s AGM, for the Premier to have stepped forward and publicly issued instructions to Mr. Martin.  She ought to have told him that Nalcor "must" operate under the same rules which now apply to Government Departments, like Transportation and Public Works, that it "must" provide for complete public disclosure.

But, the Premier did no such thing.

There is a great tragedy of wilful and structured secrecy playing out in this Province.  It has the acquiescence not just of the Government; many members of the media have neither noticed it, as a fact, or its implications.  It does not get noted by even one civic leader, in an election year.  The two Opposition Parties still pull their punches in mortal fear that they will find themselves on the wrong side of history. 

Given its enlarged authority, access to public money and Government-sponsored secrecy, Nalcor now represents ‘a clear and present danger’ to the economic and social viability of Newfoundland and Labrador. 

When a Government does not behave rationally or in its own best interest (which is the public interest), it earns the term 'rogue'.  It is a harsh charge, for any government, especially one based in a democratic society.  Public unease and distrust of Premier Dunderdale is already manifest. Worse Polls may be in her future, before she comes to her senses; the fear is that by then, Nalcor's dreams of 'statehood' will have cost us far too much.