14 March 2014

Nalcor Oversight #nlpoli

The provincial government will be establishing a committee of senior public servants to co-ordinate information on Muskrat Falls for cabinet.

VOCM faithfully reported Premier Tom Marshall’s comments to reporters outside the House of Assembly.  The people want more, says Tom, so the Conservatives are going to give the public more oversight.  The new committee will receive monthly project updates and quarterly financial updates from Nalcor, according to the VOCM story. The committee will issue an annual report.

All new stuff supposedly.

Except it isn’t.

Nalcor issues an annual report and holds an annual public meeting, as Marshall pointed out during the scrum with reporters.

But there’s more.

As Nalcor indicated publicly last summer, the company already provides the provincial government with “detailed monthly project reports … outlining expenditures, employment, benefits and procurement information. These reports are submitted to government and made public around the 15th of each month. Reports are posted on the Muskrat Falls Project website…”. They’ve been doing that since project sanction.

So what’s new about all this?

That’s a good question. 

Why is government creating this committee?

Well, that’s another good question.  Cabinet already has plenty of ways for Nalcor to report to them about Muskrat Falls and just about anything else the company is doing.

There’s the formal reporting process through the natural resources department.  There’s also the informal process given the close relationship between Nalcor boss Ed Martin and the provincial Conservatives since they first hired him in 2005. So close is the relationship that Ed showed up at Kathy Dunderdale’s farewell spectacle back in January, if you recall.  That’s not exactly the usual place for the head of an ordinary Crown corporation. If Tom Marshall wants a report on Muskrat Falls, all he’d have to do as Premier is the same thing he did as finance minister or natural resources minister:  pick up the phone and ask for it.

Then there’s the other connection between the political appointees on the Nalcor board and cabinet.   Terry Styles, for example, is the chair of Nalcor’s board of directors and a number of the subsidiary corporations.  Styles got the job because of his political and personal reliability.  He’s been a big contributor to the party and he has a personal relationship with a senior cabinet minister. If Tom wants to make sure everything is going smoothly, he can call Terry and find out what is going on.  If Tom doesn’t like the answer,  Terry is one order-in-council away from being replaced.

Marshall told reporters the committee is a response to public concerns about oversight of the project.  Your humble e-scribbler has been following the Lower Churchill project for the past couple of decades. 

People have been talking about independent review since November 2010 when the provincial Conservatives announced the Muskrat Falls project.  But all that was before the cabinet approved the project for construction.

The only time oversight or review has come up lately didn’t involve a public call for more oversight. Rather, it was a story last fall from Des Sullivan  - Uncle Gnarley -  that tied Jerome Kennedy’s sudden departure from cabinet with his growing frustration over reporting by Nalcor on the project.

According to Sullivan,   Kennedy wanted to set up an oversight committee of finance department officials “supplemented by outside experts.”  The committee would do its own appraisals of Nalcor's financial information.

Sullivan wrote that Kennedy went to the Premier with the demands that she order Nalcor to release the information Kennedy wanted and that she approve creation of the “Muskrat Falls Oversight Committee”.

Dunderdale refused, according to Sullivan and so Kennedy quit in frustration.

In another post, Sullivan criticised the way then-Premier Kathy Dunderdale and other senior politicians accepted Nalcor’s reports at face value and never – apparently subjected them to any independent scrutiny.  Sullivan based his criticism on his own experience in business over the past 30 years as well as his decade as a senior official in the Premier’s Office under first Frank Moores and then Brian Peckford.

The other place oversight came up recently was in a Telegram story based on James McLeod’s pair of interviews with natural resources minister Derrick Dalley. McLeod went looking for the report by the independent engineer the federal government appointed as part of its loan guarantee.  He didn’t get it  - the department said they didn’t have it - and then wondered how odd it was that the day after he got that letter the department told him they got a copy of the report and wouldn’t release it.

Dalley made it plain that Muskrat Falls was the subject of all sorts of oversight.  Dalley’s own department had constant contact with Nalcor officials, for example, and cabinet has had no trouble getting information. The oversight and discussion “is endless”, according to Dalley.

Dalley was also adamant that the government would not review details of the project. He said there was no way that the government could duplicate the expertise at Nalcor.

Curious, isn’t it?  The Premier and the natural resources minister repeat time and again the different forms of oversight the provincial government has over Muskrat Falls.  Then the Premier announced on Wednesday what he described in the House of Assembly as a new “protocol that government will enter into with Nalcor to ensure additional oversight that the people of the Province want to see.”

Yet what Marshall talked about on Thursday looks like nothing more than what Nalcor and the provincial government are already doing.

Perhaps we will learn more next week when the Premier and Dalley hold a joint news conference on the protocol.