Apparently compensation talks between the provincial government and AbitibiBowater have broken off.
When they broke off no one knows since natural resources minister Kathy Dunderdale didn’t say and apparently no one asked. Talk about freedom from information.
But were they ever on in the first place?
According to AbitibiBowater chairman David Paterson, the only “talks” involved Abitibi and the provincial government’s energy company, NALCO.
Still, he said, the process is very one-sided. "[It] basically consists of Newfoundland telling us what they are going to do and we have to comply."
He said the expropriation legislation does not give the company any right to a judicial hearing. As a result, the determination of value "is at their whim."
Read the comments on the CBC story linked above though and you’ll see a bunch of people who don’t appear to have thought all this through. Telling Abitibi to take nothing doesn’t real solve anything, especially if the company winds up in bankruptcy protection or - worst of all – goes under entirely. There are a bunch of pensioners in Newfoundland and Labrador with a financial interest in this. Then there are the loggers who have been looking for some sort of severance package even though their union contract didn’t provide anything of the sort.
These sorts of details make the last sentence of the CBC story a bit odd:
While AbitibiBowater has no legal obligation to pay any severance at all, the government has been pressuring the company to pay it anyway as it did when it closed its mill in Stephenville.
Since the company doesn’t have any interest left in the province and the provincial government seized all the company’s assets, exactly what sort of leverage the provincial government might have over AbitibiBowater is a bit hard to see. maybe the only people who will wind up with “nuddin” - to quote one person who commented on the CBC story – will be the mill’s former workers.
Environmental trade-offs update: Just for those who haven’t been following along closely, the provincial government had intended from the outset to bargain based on a trade off between the environmental clean-up at the mill site and the hydro assets. The Telegram version of the story makes reference to this without giving that bit of background:
She also said the discussions included severance packages for loggers and the companies environmental liability of its operation.
Basically, the idea is that the money paid by the provincial government would be reduced by any amounts forked over for clean-up and severance. Now aside from the fact the provincial government has no leverage over AbitibiBowater on the severance, it surely must strike someone as odd the provincial government would tie these things together in this way.
After all, the company is liable for the clean-up any way. They could also be pressed on a moral obligation to provide some severance package to loggers even if their union hadn’t been able to secure that benefit.
But linking those payments to compensation basically seems to make the provincial government out as the source of the cash. The company won’t be paying any money for clean-up or severance under this scheme. The cash will come out of public funds.
And if the company goes bankrupt, as some seem to wish for, the provincial government will essentially be left holding the entire bag.
So what exactly was this expropriation all about, again?
-srbp-
