23 May 2006

The Rule of Opposites

Premier Danny Williams is one of those politicians who make it easy to understand what he is up to. Sometimes you just have to look at the opposite of what he says.

Take Fishery Products International (FPI), for example.

Williams said he is worried that the current board of directors and management of the company want to split it up and sell off the bits and pieces. He has expressed concern the company's quotas might be moved outside the province.

He has been somewhat cagey in his wording on occasion, referring to the directors taking decisions that are "contrary to the best interests of the people of the province." What those interests are and what would be contrary to them are left undefined. He has also said all options are on the table, including the sale of some FPI assets to the Barry Group. But make no doubt, when it comes to FPI, the Premier has identified individuals from outside Newfoundland and Labrador - foreign demons - as being a problem to be addressed only through legislation.

Therefore, he is pushing amendments through the House of Assembly which will change the way FPI is governed and managed.

But here's the thing. There isn't a shred of evidence that John Risley, George Armoyan or any of the directors of FPI are looking to do anything other than continue the company as a viable, profitable enterprise. The talk of plots to destroy FPI are just rumours pumped by the open line crowd and from time to time encouraged by Danny Williams' own remarks about decisions contrary to the province's best interests.

But even if there is some conspiracy, under the existing FPI Act, clause seven prevents the sale of all or substantially all of the assets of the company. That restriction is there in black and white.

If Premier Williams was genuinely worried about the breaking up of FPI and the sale of its assets he could have slept soundly knowing the only way that could have been done is with his consent and subsequent changes to the FPI Act in the House of Assembly for all to see. After all, the Premier used that very clause to stall allowing FPI to set up an income trust from its Ocean Cuisine marketing arm.

If the Premier still had qualms, he could ask his deputy premier and fisheries minister, Tom Rideout (left) who told the legislature in late March this year that: "[w]e believe we have plenty of legislative authority to make sure that the interests of the people of this Province are protected, and we will not be hesitant to use it, Mr. Speaker, if we have to."

Under the changes to the FPI Act now before the legislature, the break up of Fishery Products International goes from being very difficult to being very easy. The new clause seven allows for the sale, lease, exchange, mortgage or other disposal of the assets of the company with the approval of cabinet. If FPI presents two proposals to government for the sale of any of its processing plants, for example, it will be Danny Williams who chooses whether or not to accept either offer or who makes the choice between the two. A simple order-in-council will bless the deal.

What appears to have troubled Danny Williams is not that decisions would be made but rather who would make the decisions. In the changes to the FPI Act Williams has assured his personal control of FPI and, in the amendments, ensured that neither he nor government can be sued for any financial consequences of their actions.

Yet, in all of this, there is no requirement for Williams to bring his decision into public and justify it before the public, let alone seek approval of the elected representatives of the people of the province.

Under the old legislation, any sale or disposal of the company assets required amendments to the FPI Act, which inevitably meant a debate in the House of Assembly full public view. That is the route Williams took with the income trust proposal.

If anyone thinks the Danny Williams' administration is changing the FPI Act to make sure the company continues to exist as it is now, that he is preventing the break up of the company and the sale of its assets, they had better look again.

Applying the Rule of Opposites will reveal what is actually occurring. A careful reading of the proposed changes to the FPI Act also make it clear that the goal here is to ensure that the Williams administration will be making the decisions for FPI and they will be doing it with as little public scrutiny as possible.