"This wonderful legislation..."

It's interesting to go to Hansard, the official record of proceedings in the legislature, and see what five members said on the day the Green bill was hastily passed, along with a couple of a minor amendments no one explained.

Take the parliamentary father of the bill, finance minister Tom Marshall, formerly the justice minister and attorney general:

On the purposes of the bill:

Fourthly, to establish clear rules with respect to salary, clear rules with respect to allowances and resources, clear rules for members and to provide for a mandatory review of these rules at regular intervals, and the review also to take place in public.

Another purpose of the legislation is, "provide for clear and timely disclosure in relation to operations of the House of Assembly and statutory offices, including members’ salaries, pensions, allowances, resources and severance payments, that is consistent with the public interest".

On rules:

The commission, in particular, is required, in 20.(1) (e), to "make and to keep current rules respecting the proper administration of allowances for members and reimbursement and payment of their expenditures in implementation of subsection 11(2) of..." the legislation, which I will refer to shortly.

There is an interesting clause here, Mr. Speaker, in 20.(3) which says, "...the financial and management policies of the government shall apply to the House of Assembly and statutory offices except to the extent that they may be modified by directive of the commission."

That ensures that there is a set of rules in effect. If the House of Assembly Management Commission fails to make rules in a certain area, the rules of the government shall apply until modified and amended by a director from the commission.

It is also important to note, Mr. Speaker, that a change shall not be made in the level of amounts of allowances and resources provided to the members of this House except in accordance with a rule that has been made by the Management Commission, and that rule shall not be effective, Mr. Speaker - and this is extremely interesting - the rule that will govern the operation of those of us in the House of Assembly, a particular rule, will not be effective unless that rule is first brought before this House of Assembly and a resolution adopting it by this House of Assembly has, in fact, been passed.

That will make these rules certainly transparent and open to the people of the Province.

And on moving second reading:

Mr. Speaker, this legislation -

AN HON. MEMBER: Wonderful legislation.

MR. T. MARSHALL: This wonderful piece of legislation has been introduced, has been recommended by the Green report, Chief Justice Green, and I think it is important that this is a first step in the renewal, to renew public confidence in the institution of this House of Assembly and in the Members of the House of Assembly who, as I indicated earlier, the majority of which are dedicated to their Province, they are dedicated to their communities, they are dedicated to this House of Assembly and this legislation will help them to perform their duties and perform their services in a transparent and accountable manner and in the public interest to the people of this Province.

With that, Mr. Speaker, I will move second reading of this legislation.

Or take, the Opposition House Leader, Kelvin Parsons a former minister of justice and attorney general:

There is no doubt, of course, that we need to have a good foundation. We need to have good rules, and Judge Green, true to form, of course, has made it very detailed, has made it very comprehensive for that very reason. That in the future everything will be absolutely open, transparent and, most importantly I believe, accountable. There will be accountability here - it is fine to have a system, but there is no point in a system that you cannot account for it and you cannot let the people know and the public - particularly in this case, where we are all servants of the public - know what you are doing, how you are doing it, what are the rules you play by, and make sure that you do play it by the rules. That is what this will do on a go-forward basis.

He neglected to mention that the basis will go forward from October 9, not June 14.

He did, however, hint a little bit at it, if one had been paying really close attention:

There is no doubt, as well, that albeit, Bill 33 will pass and become law today, or in the near future. There is no doubt, as well, that there is still certain little tweaking, shall we say, that has to be done in terms of implementation. There are some things that must need to be done. I understand, again, there has been a good rapport with Chief Justice Green in arriving at that decision in terms of implementation, and so it should be. It is good to see. I understand he met, as recently as this morning, with some representatives of all three caucuses represented in this House and answered any questions and concerns they had and so on. So, it is good to see that rapport continues, albeit he has submitted his report, and whatever needs to be done will be done, must be done and it will be done in such a way that it is proper and that, no doubt, there will not be anything done that does not meet with the approval and consent of Chief Justice Green and his committee. It is good to see that we have reached this point.

But then Parsons made some other comments that surely would have led people to conclude - as many did - that The Rules would be in force along with the rest of the legislation:

I understand, in fact, that even the rules piece that he recommended, we will be seeing an amendment come forward here today so that even the rules that he suggested, the very detailed, specific rules as to what you can and cannot do, and how you record it and so on, that will be introduced here today as well as part of this bill, a schedule to this bill, and so it should be.

I can say to the Government House Leader right now that, on the understanding that amendment is coming forward, we will certainly be in favour of that. As far as we can see there will not be any need for detailed discussions or whatever in Committee with respect to enforcing and having those rules become a part of this bill as well.

Accountability.

Transparency.

Clarity somehow was left behind. As both NDP leader Lorraine Michael and Government House Leader Tom Rideout have said, they both understood what was going on. Too bad they never bothered to tell the rest of us.

In the House of Assembly, Lorraine Michael sensed a certain irony to the whole proceeding:

There is a bit of an irony, and I think we should acknowledge it, that one of the things Chief Justice Green mentions in his report is the fact that sometimes legislation may get passed very quickly in the House, and sometimes quick passage of legislation can lead to things happening inadvertently, decisions getting made and after the fact recognizing, oh, yeah, well maybe we weren’t on top of that when the decision was made. I have seen some of that in going through some records with regard to the House.

Elizabeth Marshall, the former auditor general spoke at considerable length about the new audit provisions of the legislations. On the rules, she said this:

Mr. Speaker, as I mentioned earlier, the new detailed rules were also prescribed by Justice Green. These are laid out in the report and these also have been tabled here today in the House of Assembly. Really, that is a starting point for the Members of the House of Assembly and for the Internal Economy Management Commission, that these are starting rules. Of course, the commission, if they follow a certain process they may change the rules, but the approval process is something that has to be very open and it has to be made public. Also, any changes in the rules, which are made by the commission, have to come forward to the House of Assembly in a public forum for ratification.

Not a word, from Ms. Marshall on the delayed implementation of the rules.

Yvonne Jones, a senior Liberal spoke to the bill and did address the issue of ethics and donations, saying this:

Mr. Speaker, let’s talk about the ethics piece for just a moment, because there are a number of things in this bill that speak to the conduct of members and the ethics of members. One of the things that the Chief Justice is recommending is that there be no more donations given out by MHAs, and despite what I wrote in my survey, Mr. Speaker, that I wanted to continue to give donations - I will admit it - I am prepared to live by the recommendations that the Chief Justice have laid out for us. I understand his rationale behind it, I understanding his reasoning behind it and I am more than willing to accept that, as I have told him personally myself.

Not a word again about why the implementation of the rules was being delayed.

Five members of the legislature, some of them long-serving members who hold or who have held senior positions in Liberal or Conservative ministries, did not once note the reasons why the rules were being delayed until October 9.

Finance minister Tom Marshall did give the implementation date, in passing,as he closed Second Reading, just as surely as his colleague Tom Rideout introduced the amendment.

But there was no explanation as to the reasons, and simply put, that's just not good enough. It isn't good enough when every other comment by every other member who spoke to the bill left the clear and unmistakeable impression that Chief Justice Green's rules were in effect along with all the other provisions of the Green bill.

There was much talk of restoring public trust and confidence in the legislature. That's just another way of saying public support.

Well, in public relations there's an old definition of what public relations is all about. PR, as it goes, is about gaining and maintaining public support.

In order to gain support, people have to know what you are doing and why. They have to know.

In order for them to know, the people with the information have to tell the people - like you and me - who don't have it.

If the members don't tell us, how can we know?

It's that simple

And obviously some people still just don't get it.

-srbp-

Restrictions, Bob? Not exactly.

Don't blame former CBC producer and now Telly columnist Bob Wakeham.

When he put his column to bed for the Sunday paper, it's a fair bet he was labouring under the same misapprehension the rest of us were about Chief Justice Derek Green's rules on constituency allowance spending by members of the House of Assembly.

He thought they were in place.

So did most of us, until we found out the reality.

A mistaken impression, aided entirely by the silence of no fewer than six members of the House of Assembly who spoke on the Green bill, allowed Wakeham to write in his column "Where will MHAs be vacationing this summer?":

The MHAs will be at a disadvantage this summer, of course, due to the restrictions Chief Justice Derek Green has placed on the cash they get to cover their asses in the districts...

Restrictions, Bob?

Not exactly.

-srbp-

Backuppable Tom strikes again

labradore wades into the controversy which your humble e-scribbler has aroused over the House of Assembly's decision to implement Chief Justice Derek Green's Rules but not until after the next provincial election.

labradore systematically demolishes the logic - or is that illogic - in claims made by the provincial government's man of a thousand titles Tom Rideout, right in an immortal picture from cbc.ca/nl, and by Paul Oram, cabinet-minister-wannabe.

There are so many choice quotes from Rideout and Oram, both of whom appeared to be scrambling to cope with the unexpected issue, but the best of all was Rideout's comment to VOCM:

Look that's all poppycock nonsense and dribble from people who don't know what they're talking about. Members have to concur with the, with the ban on donations. Members have to concur with the fact that discretionary spending is gone. All of these matters that was in the rules as brought forward by Judge Green have been accepted and implemented. There's the matter of some mechanisms that can't be put in place overnight.

Given that "all of these matters that was in the rules as brought forward by" Chief Justice Green have been accepted but won't actually be implemented until October 9, Rideout's comments are about as accurate as Jim Flaherty claiming that the Atlantic Accords haven't been changed and that the era of federal-provincial bickering is now over.

Those "mechanisms" Rideout refers to in the last sentence are actually all the rules "as brought forward by" Chief Justice Green.

Like the one that says a member of the legislature is personally liable for overspending on his or her expense account.

or the one that says a member of the House of Assembly cannot make donations using public funds.

Not in force.

Until October 9.

Mark it on your calendar.

You can bet every sitting member of the legislature running for re-election has it red-circled.

-srbp-

What Tom said on the Green report

Exerpt from an interview with Deputy Premier Tom Rideout, aired on CBC radio On the Go, Friday, June 22, 2007:

Well, first of all, let me say that any changes made to the Green Report and the legislation that accompanied the Green Report were made in total concurrence and consent with Chief Justice Green.

Not one T was uncrossed or not one I undotted without, without his consent or his concurrence. There are certain aspects of the Green Report that, that he didn't develop a regulatory regime on. For example, the number of trips that members can take to their district and be reimbursed for, the number of days they can be out of their district and in St. John's and be reimbursed for. He made some general recommendations but no firm conclusions.

So, that matter has to be addressed by a management board, a new management board of the House which has to be, which has to be put in place and report and he concurred that that can't happen, you know, that has to take time to happen an that the recommendation, those recommendations could only come in effect at some time in the future.

And he agreed and we all agreed that the effective date ought to be the election day, which is October ninth. So, there are mechanical matters, there are other matters, for example, like, like a software program that reports automatically on members' expenses. It's in place in some departments now; it's not even, it hasn't even been put in place in the House of Assembly yet. These are mechanical things that have to be put in place and take time to put in place. He agreed to that and he agreed
that those, that it was necessary to reflect that in the schedule of the Act that we passed through the Legislature. So, it was done with his consent and with his concurrence.

-srbp-

Accountability and Transparency

Transparency and accountability are the building blocks of public confidence.

Chief Justice Derek Green

In his comprehensive report, Chief Justice Green made a simple observation that conceals a much more profound truth for the members of the House of Assembly.

The public must have confidence in its legislators, confidence that has been seriously eroded by the House of Assembly spending scandal after a year of revelations.

No one doubts the sincerity of the Premier and the other members in addressing the matter. We all may take them at their word.

However, at this point, intentions and words are not as important as actions in restoring that public confidence.

As Ronald Reagan used to say, "trust but verify".

The verification in this case is contained in the schedule to the Green bill passed by the House of Assembly on the last day of its session before the general election.

The schedule set down rules for reporting of spending in the legislature and for public disclosure of that spending. It also set down specific rules for spending constituency allowances, something many members said had been absent.

The action that would have given full and unquestionable proof of the members' intentions would have been the immediate adoption of the schedule to Green's bill. If there were concerns about specific sections - such as the transportation ones - those may have been set aside to be addressed later.

Fundamentally, however, transparency and accountability is the core of the current problem in the House of Assembly, as Chief Justice Green noted.

The core of transparency and accountability is telling the public what is being done and why.

In the case of the Green bill, the members of the House of Assembly didn't do that. In fact, they left the impression that the rules were in place already, not, as it turned out, that they would come into force after the next election. Take a look at Rob Antle's Telegram story and one sees just that impression.

At no point, did any member of the legislature tell the members of the public clearly what was being done and why. All members knew or ought to have known. Certainly the senior leaders - the House leaders from each party - knew what was going on. Yet, in the House they said nothing.

This was not a decision of the Williams administration alone and no one should direct an attack or criticism specifically at the premier's administration.

Rather the failing here is one to be borne collectively by all members of the House from all parties.

On their first step on the road to restoring public confidence, all members of the House of Assembly stumbled and stumbled badly. They will undoubtedly try and offer some excuses, as Paul Oram has attempted already.

Fundamentally, however, Mr. Oram's explanation simply calls into question the decision to postpone adoption of The Rules. If caucuses have already agreed to be bound by the rules, then they ought to have been given full force of law. Why pussyfoot around, especially since a clear and unequivocal action would have left no doubt as to members' intentions?

And for members attempting to deal with the issue individually, a clear set of rules would relieve them of the pressure from groups long used to receiving various donations from public money in a way Chief Justice Green unequivocally denounced. They do not have to set arbitrary rules about which donations to grant and which to reject or to face the potential questions when some of their colleagues might be found to have done something different from what they have done.

One set of rules would bind them all to the same standard. After all, the absence of rules is the excuse offered by so many members of the House and the creation of clear rules set by Chief Justice Green is what so many of those same members pined for.

Why then, did they postpone adopting The Rules?

Why then, didn't they tell the people of the province what they were doing and why?

Why, after a year of revelations and the repetition of the words "accountability" and "transparency" does it appear that all the members of the legislature don't seem to understand what those words actually mean?

-srbp-

Democracy Watch on public gifts

The other side of the treating business, namely gifts to politicians and their staffs:



Scientific Studies Show Even Small Gifts Have Undue Influence -- New Federal Ethics Watchdogs Must Enforce Federal Rules That Prohibit Almost All Gifts to Politicians, Staff, Appointees and Public Servants, and All Governments in Canada Must Also Prohibit Gifts

OTTAWA - Today, Democracy Watch called on the new Conflict of Interest and Ethics Commissioner, new Public Sector Integrity Commissioner, and the still-to-be-appointed Commissioner of Lobbyists to require some recent large gifts to federal MPs to be returned, and to issue public interpretations and strictly enforce rules on gifts to politicians, ministerial staff, Cabinet appointees and public servants that have never been enforced. Former Ethics Counsellor Howard Wilson and former Ethics Commissioner Bernard Shapiro and ongoing Registrar of Lobbyists Michael Nelson completely failed to enforce ethics rules concerning gifts, sponsored travel and other benefits.

Democracy Watch also called on municipal, provincial and territorial governments across Canada to ensure that they have strong rules in place that prohibit even small gifts, as even small gifts have been shown to have undue influence on decision-makers, and to ensure that they have a fully independent, fully empowered ethics watchdog agency to enforce the rules. Gift scandals have occurred across Canada in the past few years.

Scientists in both Canada and the U.S. have shown through clinical studies that even small gifts have undue influence because they create a psychological obligation to return the favour. Research by Dr. Joel Lexchin of York University and others has shown clearly that doctors change their drug prescribing patterns because of gifts, large and small, given to them by drug companies. In response to this research, and several gift-giving scandals, the International Federation of Pharmaceutical Manufacturers Associations in January 2007 announced a new worldwide code prohibiting essentially all gifts to doctors from drug companies.

Dr. Robert Cialdini, and other psychologists in the U.S., have conducted clinical studies showing that gifts (even small ones) and other benefits are the most powerful way to influence people.

The federal Conflict of Interest Code for Members of the House of Commons (MPs Code) specifically bars MPs and their family members from accepting "any gift or other benefit" (including sponsored travel) connected with their position (subsection 14(1)) except normal "hospitality" or "protocol", and all gifts "that might reasonably be seen to compromise their personal judgment or integrity" must be declined (subsection 2(e)). The MPs Code also requires MPs generally to "uphold the highest standards so as to avoid real or apparent conflicts on interests" (subsection 2(b)). The code for federal Cabinet ministers, their staff, Cabinet appointees and senior government officials, and the Values and Ethics Code for federal public servants, contain similar prohibitions.

"Many people in government love the gravy train of gifts, wining and dining and event tickets from lobbyists, and wilfully ignore the clear, scientific evidence that such gifts influence their decisions," said Duff Conacher, Coordinator of Democracy Watch. "Governments and ethics watchdog agencies across Canada must immediately stop this unethical gravy train in its tracks."

- 30 -

FOR MORE INFORMATION, CONTACT:
Duff Conacher, Coordinator of Democracy Watch
Tel: (613) 241-5179

One last trip to the trough?

To commence a new era of accountability in the Newfoundland and Labrador legislative assembly, the House of Assembly Accountability, Integrity, and Administration Act was introduced, which is a piece of legislation that incorporates the recommendations of the Green Report.

News release:"House Leader Extremely Pleased with Productivity During HOA Spring Session"
Government House leader Tom Rideout,
14 June 2007

[Updated with new post script. originally posted 9:00 PM, 21 Jun 07]]

Deputy Premier Tom Rideout may be pleased, but most Newfoundlanders and Labradorians likely don't realize that Rideout and his fellow legislators quietly shelved some key provisions of Chief Justice Derek Green's legislation aimed at cleaning up the House of Assembly spending scandal until after the fall election.

The members delayed implementing restrictions that, among other things, ban the practice of handing out gifts and donations from constituency allowances.

Here's one section on hold until after October 9:

46 (5) A member, in his or her capacity as a member, shall not make a donation or gift, whether of a charitable nature or not, to any person, group or community except as may be contemplated by subsection (3) and section 27. [Emphasis added]

(6) Where a member makes a donation or gift, whether of a charitable nature or not, in a personal capacity, the member shall, in making the donation or gift, stipulate that any acknowledgment of the donation or gift shall not identify him or her as a member.

Right behind it is another provision that further restricts what public money can be spent on:

47. (1) An expense of a type listed in subsection 46(3) may not be

reimbursed if

(a) it is not directly connected with the member’s responsibilities as a member in relation to the ordinary and proper representation of constituents and the public;

(b) it is incurred in relation to partisan political activities or promotion; or

(c) one or more of the following persons has a financial interest in the contract or other arrangement under which the expense is incurred or in a corporation that has a financial interest in the contract or other arrangement under which the expense is incurred:

(i) the member,

(ii) an associated person in relation to the member,

(iii) another member, and

(iv) the spouse or child of another member. [Emphasis added]

The amendment was made at the committee stage on the very last day of the session as everyone was looking to get the last bits of work cleared up. The seemingly innocuous changes were moved by Rideout and passed on a voice vote all in the space of a few minutes.

The change was made even more speedily and without any public comment. By contrast, even the hasty changes to the Internal Economy Commission Act in 1999 that barred the auditor general from the Assembly accounts garnered a few remarks from each of the House leaders in turn.

The changes to the Green bill were more like a St. John's City Council pay hike vote. Here's the extract from Hansard, in which Deputy Premier Tom Rideout moved an amendment:

MR. RIDEOUT: Thank you, Mr. Chairman.

I would like to move that the bill be amended by adding immediately after clause 71 the following: 71.1.(1) "The rules contained in the Schedule shall be treated for all purposes as if they had been made by the commission under section 64 and, to the extent necessary, to have been adopted by the House of Assembly under subsection 20(7)."

Also, subsection (2) "Notwithstanding subsection (1), the rules contained in the Schedule may be dealt with by the commission under section 64 as if they had been made by the commission."

CHAIR: It is moved by the hon. Government House Leader that clause 71 be amended. The Chair rules that the amendment as put forward by the hon. Government House Leader to clause 71 is in order.

Is it the pleasure of the Committee to adopt the said amendment to clause 71?

All those in favour, ‘Aye’.

SOME HON. MEMBERS: Aye.

CHAIR: All those against, ‘nay’.

Carried.

Motion amendment, carried.

CLERK: Clause 72.

CHAIR: Clause 72.

The hon. the Government House Leader.

MR. RIDEOUT: Thank you, Mr. Chairman.

I move subclause 72(2) of the bill be amended by adding immediately after paragraph (b) the following: (c) "The Schedule comes into force on October 9, 2007."

CHAIR: It is moved by the hon. Government House Leader that clause 72 be amended. The Chair rules that the amendment as put forward by the Government House Leader is in order.

Is it the pleasure of the Committee to adopt the said amendment to clause 72?

All those in favour, ‘Aye’.

SOME HON. MEMBERS: Aye.

CHAIR: All those against, ‘nay’.

Carried.

On motion amendment, carried.

CHAIR: Is it the pleasure of the Committee to adopt clause 72 as amended?

All those in favour, ‘aye’.

SOME HON. MEMBERS: Aye.

CHAIR: All those against, ‘nay’.

Clause 72, as amended, is carried.

On motion, clause 72, as amended, carried.

That's it.

It all looks like gobbledlygook or trivia until you check the bill, as passed and see what the amendment to section 71 and of course section 72 did.

Turns out the amendments meant that certain provisions of the bill wouldn't come into force until after the next election. Those sections are largely the set of rules on allowances and spending - actually titled "Rules", incidentally - that are intended to:

(a) to provide resources to members to assist them to fulfill their public duties and responsibilities as members of the House, for the benefit of the residents of the province;

(b) to promote accountability in, and transparency with respect to, the expenditure of public funds; and, [Emphasis added]

(c) to facilitate public understanding of the use of public funds in fulfillment of members’ obligations.

Basically, all the sections of the bill setting controls on constituency allowances aren't in place and won't be in place until after the next election. One of the strong rules that won't be in effect until after October 9 would hold a member liable for over-runs on his or her allowance. Chief Justice Green's analysis, similar to observations made by Bond Papers last fall, suggests members of the legislature were more inclined to run up their allowance spending in the period immediately before an election.

-srbp-

Postscript:

Apparently, not a single member of the legislature quoted in Rob Antle's otherwise fine story in the Telegram mentioned that some provisions of the bill - particularly about constituency allowances - were being shelved until after the fall election.

Legislature green-lights Green report; House adopts recommendations of report issued by chief justice

The recommendations of Chief Justice Derek Green are now black-letter law.

The House of Assembly swiftly passed Bill 33 Thursday. The new law incorporates the recommendations of Green's report into financial arrangements at the legislature. Green provided draft legislation as part of his sweeping review.

It was the last piece of business attended to during the spring session of the House. Lt.-Gov. Ed Roberts gave the new law royal assent.

Bill 33 contains a series of new requirements aimed at fixing financial controls at the legislature.

Those include new layers of audits, a more transparent salary structure for MHAs, stricter ethics and accountability rules for politicians, and a revamped commission overseeing the affairs of the House.

The legislature will also be thrown open to the province's freedom of information laws.

Members from all parties lauded the new law during debate in the House of Assembly.

Finance Minister Tom Marshall said that changes to things like salaries for politicians will be done through the legislature "in full sight of the people of the province."

Liberal Opposition House leader Kelvin Parsons lauded the fact that future dealings in the House will be transparent and accountable.

NDP Leader Lorraine Michael thanked Green for his work.

"All we can do now is move forward," Michael noted. She said Green's recommendations allow the legislature to do that.

Topsail MHA Elizabeth Marshall made a personal observation - she never anticipated becoming an MHA and voting on a piece of legislation that righted the wrongs of the past.

She was auditor general in 2000 when politicians barred her from examining the books of the House.

A series of law and policy changes over the years enhanced benefits for politicians, and reduced public access to information about how tax dollars were being spent.

Auditors were allowed back in to the House after the Tory government took power in 2003.

Auditor General John Noseworthy's subsequent findings sparked a series of ongoing police investigations into current and former MHAs and a key House staffer. Noseworthy found questionable spending of at least $4.4 million. He is still reviewing the appropriateness of all constituency allowance claims back to 1989.

Marshall said the passage of the new law means "transparency, openness and accountability at the House of Assembly probably for the first time ever."

Update II

The 10 Commandments didn't come with a start date.

Moses took good dictation, and when he came down off Sinai, he had the whole ready to go from that instant.

There's more than something odd that when Chief Justice Derek Green handed down clear rules, the members of the House of Assembly decided they'd put off living under them for a few months; conveniently, until the election is over.

Official spokespeople will not doubt raise some lame excuse like the need to set up the new system.

Problem with that excuse is that the rules could have been implemented the day the legislation passed. They work under the old administrative system or the new one, because the rules say things like "No donations" or "If you overspend your account, you will pay out of your own pocket."

After all, how many times did we hear someone like education minister Joan Burke tell us that there were no rules and she needed someone to hand her rules to follow? or Paul Oram tell us exactly the same thing: we need rules, 'cause right now we don't have rules, so we need rules and now that we have rules, Linda/Randy/Bill, everything will be fine.

What the members of legislature missed of course is that for the past year we have had reminder after reminder about the need for accountability. Slipping through amendments and not mentioning it at all - like the 2800 secret bucks - is fundamentally the opposite of being accountable and transparent.

"Transparency and accountability are the building blocks of public confidence," Chief Justice Derek Green of the Newfoundland Supreme Court's Trial Division wrote in a 1,300-page report released Thursday. [From the Telegram]

Penetrating insight into the obvious.

But it was so obvious that the members of the legislature didn't get it.

Just like they didn't get it at any point over the past decade.

What Green recommended

Chief Justice Derek Green recommended that his draft legislation and the associated rules should come into force at the same time.

Recommendation No. 80

(1) The draft Bill, styled the House of Assembly Accountability, Integrity and Administration Act, as set out in Schedule I to this chapter of this report, should be
presented to the House of Assembly as soon as possible for debate and, if thought advisable, enactment;

(2) Upon the coming into force of the House of Assembly Accountability, Integrity and Administration Act, the draft set of rules, styled the Members’ Resources and
Allowances Rules, as set out in Schedule II to this chapter, should be forthwith presented to the House of Assembly Management Commission, as reconstituted under the Act, for adoption in accordance with the Act;

The House of Assembly actually did something else. The rules governing how members may spend their allowances will not come into force until after the next election.

-srbp-

Jeffrey Simpson hates Newfoundland

Well, not really.

But that's what the myth-mongers among us would have us believe.

The leading critic of Simpson's latest remarks has re-opened her blog to public view and has taken to slagging Simpson on whatever radio station has an open line show or a viewer call-back line.

Plus ca change.

What Simpson actually said is available through Offal News and Simpson's interview with CBC Radio's On the Go.

Just to show how much Simpson doesn't know about Newfoundland and Labrador - note the sarcasm - here's a column on the Churchill Falls contract from 1986.

As for Simpson's remarks on the impact of demographics, you can find similar arguments here at Bond Papers last fall and in October 2005. There is nothing new in Simpson's remarks and as Simpson told CBC radio, there are a great many leading figures in the province who have discussed the issue with him at length in private.

Your humble e-scribbler isn't a leading figure even in his own house, so draw your own conclusions on who Simpson speaks with when he comes here.

A pitiful contract
Jeffrey Simpson
The Globe and Mail
Toronto, Ont.: Jul 3, 1986.
pg. A.6

Come-By-Chance periodically provokes a nibble of interest from some Israeli or Arab consortium, but most Newfoundlanders have consigned it and the other industrial failures to the far corner of their collective memory.

Not so with Churchill Falls, the Labrador hydro-electric project whose iniquitous terms can stir indignation in any Newfoundlander.

Another Smallwood legacy, the Churchill Falls project allows Quebec to make a killing on Labrador power. Quebec buys Labrador power for the laughably low rate of 3 mills and sells it for many times that rate in the United States.

Put simply, Newfoundland is getting shafted by the deal. All legal challenges, presentations to the National Energy Board and appeals to Quebec's conscience, good name, patron saints and anything else Newfoundland could think of have failed.

Quebec, after all, has a 65- year contract freely entered into with an agent of the Newfoundland Government in 1969. The power started flowing in 1976, and Quebec has been raking in the profits ever since.

Worse still, the contract calls for steadily falling rates to be paid by Hydro-Quebec for the duration of the contract.

Every failed legal challenge by Newfoundland merely solidified the sanctity of the contract. The federal Government, knowing that Quebec has nearly 11 times more parliamentary seats than Newfoundland, has been reluctant to intervene.

Quebec is legally obligated to do nothing but keep taking Labrador power at a low price and selling it for what the market will bear. It has argued that without Hydro-Quebec's consent and money, Newfoundland could never have developed Labrador power, since Quebec stands between the Churchill River and potential export markets.

Under Rene Levesque and the Parti Quebecois Government, Quebec's position remained as unyielding as it was simple - a contract is a contract is a contract. That position echoed the one taken earlier in the 1970s by Liberal Premier Robert Bourassa.

Now Mr. Bourassa, who was returned to power last December, is making modest noises that perhaps Quebec might be flexible. Newfoundland formally presented new proposals to him in March, and Premier Brian Peckford wants a meeting in the coming months. Experts from Hydro-Quebec and Newfoundland Hydro have been meeting.

It is too early to know whether Quebec is serious or is merely making polite, inconsequential noises. The Churchill contract, enduringly important news in Newfoundland, stirs barely a flicker of interest in the navel-gazing Quebec media.

Any re-opening of the Churchill contract would have to be part of a broader package of developing the hydro potential of Gull Island, further along the Churchill River.

Whether Quebec is even interested in Gull Island depends, in part, on Mr. Bourassa's hydro priorities.

He is outspokenly wedded to James Bay II, and hasn't tipped his hand about Gull Island.

Mr. Bourassa, an avowed federalist, is not required to do anything to help Newfoundland, Canada's poorest province. He has the province over a barrel, and he can keep it there for as long as he wishes. A sense of decency and the spirit of federalism, however, should make him stop lording it over Newfoundland.

-srbp-

What's in a name? Hilarity, apparently

Back in late December, we brought you the story of two Atlantic Canadian regional law firms that were in the process of sorting out the new name for the firm following a merger.

Word coming from the clerks' room was that the partners of the former Patterson, Palmer and Cox, Hanson had settled on a name which had certain masturbatory overtones.

In December, the name making the rounds was Cox Palmer.

Turns out the clerks were a bit off.

Their learned betters decided the firm needed a spiffier name than the one which had been circulating.

They added an ampersand between the two words to unveil:

Cox & Palmer

The addition of that one tiny symbol - much like sticking a fig leaf on David - was supposedly proof against anyone possibly seeing any implications of onanistic pleasure among the briefs.

Job done.

Why bring this up now?

Well, truth be told, it was an issue long forgotten. Until it popped up on the chyron beneath John Crosbie's name as he testified at the senate committee on national finance.

There was the old anti cake-spewer described as "Partner, Cox & Palmer".

Somehow it seemed to make perfect sense.

-srbp-

Gary Lunn's speech: the full text

Courtesy NOIA, the full text of Gary Lunn's speech to the NOIA annual conference. Lunn didn't actually deliver the speech since weather prevented Lunn's aircraft from landing.

Interestingly, the text of the speech is different in tone from the sections leaked the day before, presumably by the Prime Minister's Office.

-srbp-

Danny William's speech: full text

From Offal News, the text of Premier Danny Williams' speech to NOIA's annual conference.

-srbp-

Eating one's cake and throwing it up too: the Crosbie historical fiction series

From the Tuesday Globe and Mail, a comment by John Crosbie and Roland Martin on the Equalization ruckus.

Following is the text, with Bond Papers notes inserted between square brackets.


Atlantic Accord: A deal is a deal, Mr. Harper

The people of Nova Scotia and Newfoundland are neither greedy mice who gobble up cheese, as some, including this newspaper, would have you believe, nor do we, as some federal politicians have accused us, simply want to have our cake and eat it too. What we want is for Ottawa to honour the 2005 Canada-Nova Scotia and Canada-Newfoundland agreements on offshore revenues.

A recent Globe and Mail editorial stated that the current quarrel over equalization formulae "may be reduced to half a dozen simple words: 'as it exists at the time.' " We submit that the key words in the Feb. 14, 2005, agreements are: "The government of Canada intends to provide additional offset payments to the province in respect of offshore-related equalization reductions, effectively allowing it to retain the benefits of 100 per cent of its offshore resource revenues."

"As it exists at that time" is intended to clarify that the 100 per cent of benefits will be obtained by Nova Scotia and Newfoundland no matter what changes are made to the federal equalization program in the future. That is because these two bilateral agreements are economic development arrangements, no different in principle than Ontario's various federal-provincial auto-pact programs, Ottawa's recent multi-hundred-million-dollar funding of Quebec's aerospace industry or B.C.'s "Pacific Gateway" economic opportunity, all of which contribute to building a stronger and more prosperous Canada.

Don't forget that in the 1950s and 1960s, Alberta received both equalization and its oil and gas revenues until its economy had sufficiently developed. [Bond Papers: Actually Alberta received Equalization from 1957, when the program was created, until 1962. While technically correct - 1957 and 1962 are respective in the 1950s and 1960s - the Crosbie/Martin presentation is misleading. See, for example, Thomas Courchene, "A short history of Equalization".]

It might also be helpful to remind the news media, politicians, bureaucrats and the general public that in October, 2004, while the negotiations on the future of the original 1985 and 1986 accords were in progress, Paul Martin's government introduced significant short-term changes to the equalization program and signalled it would appoint an expert commission to study equalization and to recommend a long-term strategy. The commission's report is what the current Conservative government has adopted and is proudly praising.

It would be hard to imagine that in the middle of these fundamental fiscal policy actions by the federal government, Nova Scotia Premier John Hamm and Newfoundland Premier Danny Williams and all of their ministers and advisers would agree to enter into the February, 2005, Offshore Agreement and not insist that any deal protect their provinces against future changes in the equalization program, changes that might cancel out the benefits of these bilateral economic agreements.

[Bond Papers: While it might be hard to imagine, the phrase noted by the Globe editorial and debated by Crosbie and Martin is at the heart of the dispute. The key point not noted by Crosbie and Martin is that the 2005 agreement can be met in full and the Equalization program "as it exists at the time" by simply removing the cap unilaterally applied to the 2005 agreement(s). The federal government can reduce Equalization payments in keeping with the program as it exists, while honouring in full the 2005 agreement.

Federal officials apparently referred to a conundrum in an exchange with Wade Locke on this issue. The conundrum would come from differentiating between qualifying for Equalization and what payment was actually received.

One potential solution would be to consider the phrase in the agreement describing the additional offset mechanism as referring to the amount to which the province would receive without a cap being applied. This would limit the amount of Equalization actually paid to zero in some years but allow the offset to continue to function. This may all now be a moot point since the provincial government will no longer qualify for any Equalization payment at all by 2010-2012.]

It should be remembered that in, in October, 2004, former finance minister Ralph Goodale caused those negotiations to collapse when he proposed in writing that any new offshore revenue agreement include a "fiscal cap" that limited Nova Scotia and Newfoundland to the fiscal capacity of Ontario. Surely all Canadians remember the reaction to Mr. Goodale's proposal, including the emotionally charged lowering of the Canadian flag in St. John's. Then Mr. Martin, with the enthusiastic support of then-opposition leader Stephen Harper, wisely withdrew the concept of a "fiscal cap," and shortly thereafter the three parties agreed to the 2005 Offshore Agreement and related federal legislation.

[Bond Papers: Martin and Crosbie's characterization of the situation in 2004 is essentially bunk. The negotiations did not collapse in October 2004. In fact, they continued until December 22, 2004. The Premier decided on the disastrous flag tactic at that point, but restored Canadian flags once polling confirmed the strength of opinion against the move from across the country. In the subsequent January 2005 agreement, many of the provisions of the October agreement remained, even in slightly amended form. The only point removed was the fiscal capacity cap.]

Those who tell us that Newfoundland and Nova Scotia should stop complaining that the new deal contains a fiscal cap demonstrate a profound lack of understanding for the history of the 1985 Canada-Newfoundland Atlantic Accord and the 1986 Canada-Nova Scotia Offshore Petroleum Resources Accord. Worse, they mislead Canadians by implying the provinces are greedy and want to continue getting equalization once they reach the national average fiscal capacity.

[Bond Papers: This is a remarkable statement given that Crosbie has claimed as recently as last week that the intention in 1985 was to allow Newfoundland and Labrador to receive oil and gas revenues in full and Equalization in full, as if the oil and gas revenues did not exist.

Crosbie now appears to have abandoned that point in light of the historical record, as well as a rebuke from his former cabinet colleague on another aspect of the 1985 Atlantic Accord.

Martin has also previously made claims about the 1985 Accord which do not stand up to scrutiny.]

Quite the contrary. The 2005 offshore agreements do not get renewed in 2011-12 if either province is no longer receiving equalization.

Newfoundland's equalization payments have already declined from a peak of $1.2-billion in 1999-2000 to a forecasted $477-million in 2007-2008. Recent studies estimate it may no longer get equalization by 2009-2010.

The 1985 and 1986 accords were meant to make the two provinces "principal beneficiaries" of their offshore resources. Until the 2005 offshore agreements, the federal government was the principal beneficiary. That recognition of provincial benefit was the battle Dr. Hamm and Mr. Williams fought and won. If these agreements are not fully honoured, Nova Scotia and Newfoundland, and, in fact, all of Canada, will have been done a great injustice.

[Bond Papers: Once again, Crosbie and Martin enter the realm of historical fiction. While it is true the agreements are intended to make the provinces the principal beneficiary of offshore resources, the agreements themselves contain no definition of the term. Contextual and contemporary evidence suggests that principal beneficiary was intended to mean the right to set and collect revenues as if the resources were on land, the right to manage the resources jointly with the federal government and to establish local benefits provisions in any development agreements. See, for example, "Which is to be master?".

Mr. crosbie position on Equalization entitlements and offshore oil and gas revenues has also changed considerably since he was a federal cabinet minister. in 1990, Crosbie dismissed provincial concerns about the so-called clawback of oil revenues through Equalization with these words: "I'm getting a little tired of them trying to have their cake and throwing it up too. They can't do both." Consider the delightful contrast with Crosbie and martin's next sentence.]

We are neither mice, nor greedy cake-eaters. We are proud Canadians.

We just want the opportunity to utilize our natural resources to become self-sufficient. We will resist any attempts to prevent this from occurring.

_______________

John Crosbie, a St. John's lawyer, and Roland Martin, a Nova Scotia business executive, have advised Nova Scotia and Newfoundland on their offshore accords.

Talking about maybe talking about Hebron

The lines of communication are open once again between the Government of Newfoundland and Labrador and the Hebron partners.

The National Post and others reported it earlier today.

CBC News and the Telegram reported Premier Danny Williams comments early Tuesday to the annual NOIA oil and gas conference in St. John's.

Negotiations have not restarted.

-srbp-

Dan Leger's truth telling

From the Chronicle Herald, Dan Leger's column.

An interesting perspective and generally and accurate summary of the major relevant points.

One point of disagreement:

Truth No. 5: The federal government can and it has unilaterally changed the Atlantic accord. It can also claw back Nova Scotia’s gas royalties and it can thumb its nose at our complaints. All these moves are perfectly legal and constitutional. The Atlantic accord is merely an "arrangement" signed by two fairly junior cabinet ministers.

First, Brian Mulroney and Brian Peckford don't qualify as junior cabinet ministers.

Second, the 1985 Atlantic Accord for Newfoundland and Labrador states specifically that neither party can amend the enabling legislation unilaterally. Maybe the Nova Scotia deal is different.

That's not my dog.

The feds can do what they want on Equalization, within the limits of politics.

When it comes to the terms of the actual agreements, they can't.

That is my dog.

-srbp-

Bourque drives for Connies

Like this will come as a shock.

Pierre Bourque, who has been driving his Bourque website for the federal Conservatives for some time now, will also be piloting a stock car sponsored by the same political party in this season's Canadian NASCAR circuit.

At least, he's consistent.

Bourque finished 13th in a Father's Day race.

-srbp-

Some early efforts to develop the Lower Churchill

From Jason Churchill's superlative summary of efforts to develop the Churchill River's hydroelectric potential, this extract on the federal government approach during the Mulroney administration:

Once in office, Mulroney’s pre-election sentiments about simple decency on this topic were not evident. His administration failed to take any measures to ensure Newfoundland and Labrador gained unrestricted access to the North American energy markets through Quebec territory. Mulroney Cabinet Minister John Crosbie has stated that there was no practical action which the Prime Minister could have taken. He said the history of the Conservative Party in Canada demonstrated the critical importance of a federal party protecting its electoral base in Quebec in order to retain majority governments. Newfoundland and Labrador’s requests for action had perpetually asked the federal government to take action which could have aggravated voters in Quebec, especially the nationalists. According to Crosbie, a national government could not retain a majority national government if it alienated a large bloc of critical voters in Quebec to appease a smaller group of voters in Newfoundland and Labrador.94

Churchill's paper should be required reading for those interested in gaining a basic understanding of the paper.

-srbp-

Lament for a non-partisan editor

We all carry biases of one sort or another.

For some reason, people tend to expect reporters and editors to park as many of their biases - especially partisan ones - at the doorstep.

That's why it was so interesting to see a Telegram editor not only lament the demise of the old federal Progressive Conservative party, but to distort history on an apparently partisan basis.

The Liberals will likely rise again in Canada in the not-too-distant future, once the sponsorship scandal fades far enough into the background. A Liberal administration provides, if nothing else, a sort of comfort-zone governance while the country waits for a broader vision to come along.

But the national unity aspired to by the old Progressive Conservative party — even if it was only fleetingly achieved — is sorely missed.

Ah well, it only seems to fit, though. In the past, the same editor has criticized a Supreme Court judge who dealt with the law and the facts of a case, rather than delivered a decision that conformed to the editor's own misrepresentation of the province's oil and gas history.

Then earlier this year, the same editor presented the same - i.e. essentially partisan - interpretation of the current row with the Harper administration that graced the Telegram's pages on Sunday.

Too bad that in formulating his pro-Progressive Conservative editorials, Jackson paid attention to unbiased sources like Jason Churchill's history of efforts to develop the Churchill River's hydro-electric potential.

Then again, the myth of victimization - especially at the hands of "Liberal" bogeymen "is apparently just too comfortable a blankie for some people to dispose of.

-srbp-

Fakes crash Calgary oil show

From the National Post:

The crowd at Calgary’s Gas and Oil Expo received candles apparently made from a deceased janitor who worked at ExxonMobil on Thursday. But before S.K. Wolff, who claimed to be an analyst from the National Petroleum Council, and Florian Osenberg, from ExxonMobil could make their keynote address at the luncheon, security officers forced them off the stage.

The anti-globalization jokers known as the Yes Men took the stage at Stampede Park to promote their book, as well as voice their disapproval of the industry.

-srbp-

Euphonium Saturday!

Some youtube.com offerings of the glorious euphonium.

First is a tube/euphonium quartet from the American Second Infantry Division band playing an arrangement of Birdland. It cuts out aftef 2:44 but there's enough here to show what you can do.

Can ya dig it? I knew ya could.



On the other end of the spectrum in more ways than one, is a song by The Born Again Floozies: "I used to play euphonium".

Dig it, too or just dig the cymbal-playing tap dancer.

Then, from somewhere else entirely in the vast expanse of the twisted human psyche comes this piece:



To finish, there is this short clip of two guys playing the Mario Brothers theme, flowed another similar duet.

There's some kind of international thing going on with this.

From the police blotter

Some Friday night humour, courtesy of a google news search for the word "oil", comes via the police blotter published in the South Delta Leader.

There's a rash of outboard motor thefts, including this one:

June 8, 2 p.m., 100 block 66 Street: Complainant reported the theft of an outboard motor from the back of his boat that was parked on his driveway. The motor was secured by an anti-theft device that was also stolen. The outboard motor is a 2006, grey, Yamaha 8 hp valued at $3,500.

The only place where "oil"turned up was in this report:

June 12, 6:07 p.m., 4900 block Coleman Place: Complainant reported that an unknown suspect dumped oil on his front lawn. Nothing suspicious seen or heard in the area. The complainant also reported that this is the second such incident.

If the incident occurred in Ottawa at 24 Sussex, and the Lone Oil Skulker had his hair parted down the middle, we could probably come up with a suspect. For now we can just file this as bizarre. Right next to the string of outboard motor thefts.

And the stolen anti-theft device.

-srbp-

NS Liberals should consider a condom campaign

As Nova Scotia descends further into a pile of political silliness, the provincial Liberals have started a button campaign.

The buttons, described as pins by CBC Nova Scotia, say "The Deal is The Deal".

Somehow, it seems that condoms might be more appropriate under the circumstances.

-srbp-

Rodney grasps at straws

Grassroots stuff like petitions are best left to grassroots people, not Premiers.

This is just pathetic.

Nova Scotia is turning to the Internet to put some public pressure on Ottawa to settle a festering dispute over the federal budget.

Premier Rodney MacDonald said Friday he wants Nova Scotians and other Canadians to sign an electronic petition on the provincial government‘s website.

-srbp-

Putting two and two together

One of the last pieces of legislation approved by the legislature was something called the Crown Liability Act.

Specifically, it holds the provincial government immune from any legal action resulting from the break-up of Fishery Products International.

The thing was introduced in the House on June 4 and passed through second reading, committee and third reading on June 11 and 12. There were two trivial amendments. The whole thing passed through the legislature with breath-taking speed.

The thing is, there really isn't much of substance available in the public record on the purpose of this bill. A portion of the Hansard - the bit from the night sitting - isn't available on line.

So, is it possible that the real purpose behind this bill, which opposition House leader Kelvin Parsons noted appeared to have been drafted in haste, was intended to head off any problems with Cooke Aquaculture?

The New Brunswick company announced last October that it was developing a major fish farming enterprise in southern Newfoundland. Part of the FPI sale approved this month included the sale of FPI's Fortune plant to Cooke.

Suddenly - less than 10 days later - Cooke is raising doubts about the sale.

Are the two things related?

We may never know.

-srbp-

Government likes rubber stamp legislature

Deputy premier, fisheries minister and government house leader Tom Rideout is "extremely pleased with the quality and quantity of business that was achieved during this past session of the House of Assembly."

Let's take a look at the tale of the tape of accountability and transparency.

Of the 34 bills introduced in the current session, 27 were passed through second and third stages in a single day. That's 70% of the total.

Another six bills went through the detailed study stages in three days of debate or less.

Another bill was left on the order paper.

In some instances, such as the related bills on a new energy corporation, a hydro corporation and amendments to the Electrical Power Control Act, government distributed the bills publicly only a day before they were debated in the legislature. The EPCA changes weren't even disclosed publicly until the day before the legislature closed.

Neither the opposition nor the general public can be said to have had sufficient time to study any of these measures, let alone develop any idea of their implications. In the case of the energy bills, opposition members relied entirely on a canned government briefing for their remarks in the legislature during the hasty debate.

In the 2006/07 session, the House of Assembly dealt with 72 bills, 57 of which went through the supposed detailed study stage and received third reading approval within a single day. That's 79% of the total number of bills. Of the remainder, the majority were disposed of in less than a week.

One of the bills rammed through in 2006 were changes to the hydro corporation act that linked electricity prices to unregulated business activity. The revised bill introduced in the session just finished was touted as fixing the problem. In fact, the problem remains.

As a senior minister in any government, Tom Rideout should be proud. He was able to ram an amazing amount of legislation through the legislature without even the most cursory of discussion or public debate. As the senior minister in a government that supposedly supports accountability and transparency, he might be just a little chagrined.

-srbp-

Living in a fog: one Connie offers his thoughts

Mainland Connies think the people of Atlantic Canada are, to quote the Wonderful Grand Band, living in a fog, living in a dreamworld.

Nonsense like this stuff from the ironically titled My Conservative Dreamworld should give a good idea of how much traction the provincial government's arguments have out past the Port au Port peninsula.

If the Premier can't get at the Conservative vote base, there's not much hope for his so-called ABC option. He doesn't need to convince Liberals and New Democrats that Stephen Harper is a bad idea; they didn't vote for him in the first place.

In passing, it is worth noting how little this form of institutionalized bribery actually benefited its instigators. The concession on ownership rights (by Mulroney) and on natural resource revenue clawbacks (by Paul Martin) did not produce quite the electoral harvest those two gentlemen were anticipating. This also has its own rationale: when voters have grown accustomed to welfare they view it as a right, and then why should they sell their votes for something that is rightfully theirs? The Atlantic Accords is therefore that rare political event that is worse than a corrupt vote-buying exercise - namely a failed, corrupt vote-buying exercise.

Some of these guys actually want to demolish the 1985 Atlantic Accord.

Think about it.

-srbp-

Wait five minutes

Only a couple of days after dismissing legal action against the federal government as a waste of time, Premier Danny Williams is considering joining Saskatchewan in its case against the Harper administration on Equalization.

The Premier said he hadn't considered the idea of legal action, preferring to try the matter in the court of public opinion.

Meanwhile, McGill constitutional law professor Stephen Scott says there is a way to put the matter in front of the courts.

The fastest, most economical route through the legal system would be to start an action for a declaratory order to see if the agreement is legally binding.

Then Nova Scotia could use the power of reference that every province has in its statute books to send a set of detailed questions to the court of appeal.

-srbp-

300 or all politics is local

How many times have provincial cabinet ministers or the Premier's parliamentary assistant claimed that the 2005 Equalization offsets deal put $300 million in the provincial treasury this year?

Lots of times? Too many times.

Paul Oram did it this morning speaking with Randy Simms on VOCM's Open Line.

But here's the thing: it isn't true.

The 2005 offshore deal has not added a single penny of new cash to the provincial coffers since 2005.

Here's why.

The 2005 Equalization offsets deal provided for two specific things that are relevant. First, there was an advance payment of $2.0 billion. Second, the clause covering that advance payment also provided:

Amounts calculated starting in 2004-05 under clauses 3 and 4 will not result in actual payments to the province until such time as their cumulative value exceeds $2.0 billion. [Emphasis added]

The cheque was received and applied against a portion of the unfunded pension liability in 2005.

Spent.

All that has occurred over the past four budgets (FY 2004 to FY 2007) is that the finance minister is accounting for the payment that the province is entitled to receive under the deal.

There's no new cash involved. That's because there won't be new cash until the full $2.0 billion has been accounted for annually. right now, the four year total (including the paper money cabinet minister talk about for this year) is $847 million. Simple calculation: another $1.153 billion will have to be drawn down before that deal actually generates new cash in the bank.

Take a look at any of the calculations done by Wade Locke and you will see pretty quickly that the 2005 deal will not generate any new cash before the deal expires. The provincial government will not qualify for Equalization under either system - fixed pot or 50% exclusion - long before the add-on benefits reach that figure of $1.153 billion.

In some respects, the ongoing racket over the so-called side deals is a bit overblown. The Atlantic Accord (1985) provided for temporary, declining Equalization offsets intended to cushion the provincial treasury against a sudden drop in transfers. The transitional cash was intended to support debt reduction and infrastructure development.

Improving the financial lot of Newfoundland and Labrador makes sense for the province and it makes eminent sense for the country. Temporary transfers from the federal government to Newfoundland and Labrador for a well-understood purpose, even if linked to the Equalization program, is backed by precedent and the focused nature of the transfers doesn't come close to destroying the fundamental fairness of the Equalization system.

Ontarian taxpayers, among others, can rest easy that they will not be funnelling cash into a gaping maw. The whole thing is set up as a limited program. Take a look at even the most recent assessment of the Equalization program and the offsets, and one thing becomes clear: Newfoundland and Labrador's economy will do so well in the next four years that the provincial government will become a so-called "have" province in short order. Ontarians, and others upset about the offsets arrangements should follow a simple rule: don't look at the theatrics continuously surrounding the 2005 agreements; look at the facts.

Even the 2005 deal is a temporary arrangement with triggers designed to shut the whole cash tap off when the provincial government becomes a "have" province. The final agreement - as opposed to the October draft - has a dual trigger to shut down the cash flow. The province must be meet two conditions to keep receiving offsets; the draft version had an "either/or" option that made it easier to extend the deal under any Equalization formula.

Politically, it would impossible for any federal government of any stripe to produce an Equalization program that ignored completely non-renewable resource revenues. It wasn't possible in 1962 when the object of attention was Alberta and it sure as heck isn't possible today when the focus is on Nova Scotia and Newfoundland and Labrador. Only the most fool-hardy of political parties or a party with no hope of actually forming a government would make a political promise that is politically untenable.

And in Newfoundland and Labrador? Well, aside from the people who voted Conservative on the basis of the Equalization promise - were there any? - few people are likely to organize a lynch mob for Conservatives now or in the future. Sure, there are plenty of provincial Progressive Conservatives who took the cue from the Premier and worked on Conservative campaigns. Realistically, though, Equalization wasn't likely a vote driver except for a very limited number of people.

Conservative candidates may face some heat next time and a year from now they may face a vengeful provincial premier, but realistically, they can rest easy knowing that a year is a long time in local politics. Things change. In 2004, Danny Williams rejected Harper's 100% exclusion option. A year later, Harper supposedly delivered the pyjama's for Danny's cat. A year after that, Harper is "untrustworthy" and his Conservative members of parliament are "traitors".

If nothing else, Conservatives have likely taken heart from the most recent regional poll. That's why they voted for the budget on third reading, despite the intense political pressure. Look at the whole picture: the only place when Connies are currently facing a real problem is Newfoundland and Labrador. The federal Conservatives likely are counting on Danny Williams' limited traction outside his own province and, given the available evidence, he doesn't seem to have much traction.

That's because his messages are aimed mainly at his own province. His communications plan ignores the attitudes toward his goals and his approach; it makes no effort to put the local issue in a context that genuinely counteracts perceptions. It does nothing to connect with his audience except, as in the case of teachers and students, with their instinctive, ideological opposition to the federal Conservatives.

Behind it all, though Danny Williams knows full well that his province is not hurting financially. In the worst case scenario, that is where he plays it smarts and opts to maximize the cash, federal transfers to Newfoundland and Labrador through Equalization and offsets will be $2.787 billion over the next four years.

The gap between that and the old Equalization system, according to APEC figures, is less than $300 million a year over that period and that amount will likely be generated in the economy anyway. The Premier knows there will be new investment in western Labrador through Consolidated Thompson. He can count on a couple of other major developments in the next five years or so and maybe, just maybe, there will be renewed interest in the offshore oil and gas industry.

Danny Williams is a smart guy and he is playing the whole Equalization racket very smartly. If he has learned one thing over the past three years it is that Danny Williams can make whatever claim he wants and people will react to it without thinking. That's the $300 million thing, for example. He knows he can create a firestorm of domestic political controversy that makes him look good and makes others look like, well, traitors. It reinforces his status as the only force in provincial politics and that's really the point of the whole exercise.

All politics is indeed very local.

-srbp-

Why cabinet avoided a public inquiry

When judges have real powers they can upset carefully concocted sets of excuses.

Like say Chief Justice Derek Green's conclusions on the secret bonus money handed out to members of the House of Assembly, after the Accountability and transparency police came to office.

Bear in mind Green's terms of reference did not give his commission the powers of a public inquiry.

Yet he was still able to make this observation, as quoted in the Telegram:

MHAs contended the two events were unrelated.

The chief justice disagreed.

"If I were sitting in a court of law assessing, as sworn evidence, the information I have been presented with, I would not have too much difficulty in drawing the inference that the issue must have been present in the minds of at least some of the participants in the decision," he wrote.

That's judge-speak for "pull the other one, it's got bells on it."

Imagine what Green would have done if he'd put everyone he spoke to under oath.

Some politicians and their scripted supporters said the inquiry would take too long.

Like maybe a year?

Green took almost a year.

Pull the other one, indeed.

-srbp-

SK court case to undermine NL and NS

Saskatchewan's court case over Equalization will tackle the issue of fundamental fairness in the system, according to Premier Lorne Calvert.

CBC News is reporting it this way:

Calvert said the legal action would not be over a broken campaign promise.

If a lawsuit was filed for every broken Conservative promise, there wouldn't be enough lawyers, he said.

Instead, he said, the suit would be based on the sections of the constitution that require the equalization program to be fair and equitable.

One possible route to that argument will undermine the offshore side deals from 2005 between the federal government and Nova Scotia and Newfoundland and Labrador.

Why?

Because those side deals are effectively a political work-around for the Equalization program. After all, if Saskatchewan's argument is based on fair and equitable treatment, the province that's been looking for an Accord-type exemption might just put that point on the table.

If Saskatchewan doesn't raise the issue directly, we might well see other provinces weigh in on the case. Bet your bottom dollar that those other provinces - already fried about the deals - will bring it up as an example of a fundamental inequity in the federal government's approach to Equalization.

Ask Ed Stelmach if his province might seek standing on this one. His province has had its non-renewable revenues clawed back, to use that idiotic phrase, for 45 years. Why would it be equitable, from Alberta's perspective to treat that province differently from the others?

-srbp-

Offal News round up

Some choice posts from another local blog:

1. A post on the First Law of Petropolitics, a reprint of a column from the Globe on the implications in Canada.

2. "Jobs out east", a look at the local supply and service sector for the oil industry.

3. Energy transportation issues.

-srbp-

Andrew Coyne on the Equalization racket

From the National Post:

It is not true, then, to say that the Accord has been violated. It is true that Mr. Harper played Atlantic Canadians for suckers. At least he is paying the price.

Well, suckers is a strong word. Appropriate but strong.

And it's not fair to lump all Atlantic Canadians into one lot.

Only some people were suckered, and the ones who are angriest now are the ones who were fooled.

-srbp-

APEC assessment of Budget 2007 and Equalization

From the Atlantic Provinces Economic Council:

June 13, 2007

APEC releases study on the Equalization Options of Budget 2007 for the Atlantic Provinces

APEC is today releasing a new report on the implications of the proposed changes to the Equalization program for the four Atlantic provinces. The report entitled Assessing the Equalization Options of Budget 2007 for the Atlantic Provinces has been prepared by Professor Paul Hobson of Acadia University and Professor Wade Locke of Memorial University, both Senior Policy Advisors of APEC.

Following on the recommendations of the Expert Panel on Equalization, the new Equalization program includes the re-establishment of a ten province standard, simplified measures of fiscal capacity and a more predictable and stable payment system that is formula driven. The new program also reverses a pre-election commitment to exclude natural resource revenues, and includes 50% of these revenues.

The study provides estimates of the revenue flows to the four provinces under the current program (Fixed Framework) and the new Equalization program for each fiscal year from 2007-2008 to 2019-2020, the year in which the Nova Scotia and Newfoundland and Labrador Offshore Accords expire. These simulations utilize publicly available data projected forward, based on certain key assumptions. In particular, it is assumed that the aggregate of the fiscal equalization payments under the Fixed Framework will grow at an annual rate of 3.5% (as currently specified by legislation) and that non-oil and gas fiscal capacities for all provinces grow at an annual rate of 1.4% (the aggregate rate of growth of per-capita fiscal capacity in Canada over the last ten years). In addition, the simulations take into account changes to the Fiscal Arrangements Act, and to Offshore Accord legislation as detailed in the Budget Implementation Act (Bill C-52).

The Atlantic Accord, signed in 1985, and the Canada-Nova Scotia Offshore Petroleum Resources Accord, signed in 1986, gave Newfoundland and Labrador and Nova Scotia, respectively, the right to collect royalties and to levy taxes on offshore operations as if the resources were on provincial land. In addition, the Accords provide Equalization offset provisions to compensate for potential reductions in Equalization payments as these additional revenues come on stream. The 2005 Nova Scotia and Newfoundland and Labrador Additional Fiscal Equalization Offset Payments Act provided for additional Equalization offset payments to Nova Scotia and Newfoundland and Labrador to ensure that each province would receive 100 percent of the benefit of its offshore revenues. That is, offset payments would ensure no claw back of offshore revenues through Equalization.

The summary revenue implications for each of the four Atlantic provinces are provided in the table below. Nova Scotia, New Brunswick and Prince Edward Island are better off financially under the new Equalization program for two years and thereafter are disadvantaged by the revised Equalization program. Newfoundland and Labrador is immediately worse off under the new program.

Specifically, the impacts on the provincial treasuries are:

o Nova Scotia - $159 million increase in revenues for the first two years under the new Equalization program, and reduced revenues in each year thereafter compared with the Fixed Framework: in aggregate, the province receives $1.4 billion less under the new Equalization program than under the Fixed Framework;
o New Brunswick - $68 million increase in revenues for the first two years under the new Equalization program, and reduced revenues in each year thereafter compared with the Fixed Framework: in aggregate, the province receives $1.1 billion less under the new Equalization program than under the Fixed Framework;
o Prince Edward Island - $7 million increase in revenues for the first two years under the new Equalization program, and reduced revenues in each year thereafter compared with the Fixed Framework: in aggregate, the province receives $196 million less under the new Equalization program than under the Fixed Framework;
o Newfoundland and Labrador - $654 million reduction in revenues for the first two years under the new Equalization program, an increase of $22 million in the third year, and reduced revenues in each year thereafter compared with the Fixed Framework: in aggregate, the province receives $1.4 billion less under the new Equalization program than under the Fixed Framework. It should be noted that Newfoundland and Labrador will no longer be a recipient of Equalization after 2008-2009, under both the Fixed Framework and the new Equalization program. [Emphasis added]

Beyond 2007-2008, both Nova Scotia and Newfoundland and Labrador can choose to permanently opt into the new Equalization program or remain under the Fixed Framework. The results clearly indicate that both provinces should remain under the Fixed Framework. Since other provinces were not offered this choice, this would result in an unprecedented situation in which two distinct Equalization programs are operating simultaneously, a situation which is not likely to be sustainable.

Furthermore, Equalization payments under the new program are constrained by a fiscal capacity cap. For purposes of the cap, fiscal capacity is measured, on a per-capita basis, as the sum of non-resource fiscal capacity, one hundred percent resource fiscal capacity, (pre-cap) Equalization entitlements and payments under the Accord legislation (applicable only to Nova Scotia and Newfoundland and Labrador). Total fiscal capacity of a receiving province cannot rise above that of the lowest non-receiving province. Should it do so, Equalization payments are to be reduced accordingly.

The Budget Implementation Bill contains significant changes to the 1985 Atlantic Accord, and to the 2005 Nova Scotia and Newfoundland and Labrador Additional Fiscal Equalization Offset Payments Act, necessitated by the introduction of the new Equalization program. The protection provided by the Accords is undermined by any Equalization reductions caused by the fiscal capacity cap, since any reductions amount to claw backs of Accord payments. In the authors’ view, this violates both the letter and the spirit of the Accords. [Emphasis added]

****************************
The Atlantic Provinces Economic Council is an independent, non-profit research and public policy organization that seeks to advance the economic development of the Atlantic region.

-srbp-

Williams big on Harper promise...in 2006

From the archives, a couple of stories containing Danny Williams' fulsome praise for the newly elected Harper administration.

Did the Premier actually claim he never trusted the guy?

Williams sees new allies in Ottawa
CBC News

Premier Danny Williams says a new Conservative government in Ottawa is nothing to fear – and could deliver on long-standing issues involving the federal government.

"I think Atlantic Canadians are going to be very pleasantly surprised and pleased with the performance of Mr. Harper," said Williams.

While Williams embraced Harper's response to a letter he sent to the major party leaders on issues pertinent to Newfoundland and Labrador, he refrained from actively campaigning for the Conservatives in the election.

Instead, Williams planted a sign supporting Conservative candidate Norm Doyle outside his residence, and used cautious language during the campaign.

During the campaign, Williams also applauded a response from NDP leader Jack Layton to the same list of questions, while being cool to the response from Liberal leader Paul Martin.

Williams also denied a rift between himself and the new MP for Avalon, Fabian Manning.

Manning was booted from the provincial Progressive Conservative caucus last May, after Manning spoke out against the provincial government's controversial raw materials sharing plan for the crab industry.

Williams said the dispute was "a caucus issue" and applauded Manning's victory.

"In all fairness to Fabian, I wouldn't take anything from Fabian's victory tonight. It was expected," said Williams, who noted a number of the members of the provincial Tory caucus campaigned for Manning.

In fact, Williams suggested that the Atlantic Accord dispute – in which he launched salvo after salvo against the Martin Liberals in a campaign to wrest more financial benefits from the offshore oil industry – helped Manning take the seat.

"That was John Efford's former district. The Atlantic Accord played a big role in that particular district, as it has played a role in the entire province," Williams said.

Efford, who won the Avalon race in 2004 with almost 60 per cent of the vote, became a lightning rod for anger when he rebuked Williams in the early days of the Atlantic Accord fuss.

"We basically had to drag Ottawa kicking and screaming to come with the Accord deal … I think it played a significant factor."

Efford announced his retirement in November, citing his lengthy battle with diabetes.

Williams, meanwhile, said he looks forward to a productive relationship with Harper.

"It's a delicate job [and] it's a difficult job to manage the relationship between the premiers and the prime minister of the country. However, I think it will be a refreshing change," Williams said.

He said he expects Harper to follow through on pledges involving the fishery, energy issues and the "fiscal imbalance" in Atlantic Canada.


Provincial Politicians Weigh In on Election - Jan 24, 2006
VOCM

Premier Danny Williams says he was a little surprised at last night federal election results. Williams says he thought Stephen Harper's Conservatives would get a larger minority than they did. He's also surprised that Atlantic Canada did not go a little stronger towards the Conservatives. Overall though he is generally pleased with the
result. He says the biggest issue facing the province is the fishery.

Williams says he did give some consideration to calling a by-election in Placentia-St. Mary's today, but he says this wouldn't be fair to party workers having just come off a federal election which saw Fabian Manning win John Efford's old seat. The by-election will be held soon.

Opposition Leader Gerry Reid says Paul Martin has made the right decision to step down as Liberal leader. Following his defeat last night, Martin announced he will leave the post after an orderly transition of power. Reid says Martin realizes that he can't lead the party to another victory. Reid says he believes Brian Tobin would be a good choice and Canadians would accept him.

Provincial NDP leader Jack Harris says given the calibre of local NDP candidates he's very disappointed the Province hasn't sent an NDP member to Ottawa. As for the Conservative minority victory, Harris told VOCM Open Line the federal NDP will have a strong voice in the House of Commons.

How times change.

-srbp-

A spotter's guide to plants and other political flora

That would be labradore, which ha staken lately to tracking the appearances of the various planted and scripted supporters of the current provincial governing administration.

labradore's wjm has also been known to tackle the factually dubious comments of individuals, including reporters on subjects of interest to the province. Odds are he's right and the quibbles he raises are only sometimes trivial.

If David Cochrane actually claimed - as wjm says - that Danny Williams was neutral in the last federal election, then Cochrane would have to be officially classed as out-to-lunch. Progressive Conservative members of legislature would not have dared campaign openly for Connie candidates if Danny Williams himself disapproved.

Danny Williams himself would not have actually invented commitments from Stephen Harper if he was not actively involved in the federal election campaign.

If a claim is made, odds are that wjm will challenge it. Incidentally, CTV's Bob Fife is a fact checker's nightmare, but oddly wjm hasn't set his sites on that guy yet.

But to return to the main story, wjm is especially adept at spotting the numerous planted callers organized by the premier's office to spread the official partisan position of the moment on the issue of the moment. He's named most of them who call regularly. He's noted their odd habit lately of stating that "it's not like they get told what to say from the premier's office", or words to that effect.

Kinda like saying "It's not about Danny" two or three times on a subject that pretty much is all about Danny.

Roger Grime's is quoted in news media? A raft of callers will turn up saying "I don't know how he can gave the gall to stick him head up...".

Like dandelions after a good rain, they will pop up all saying exactly the same thing. People who don't normally call will suddenly be spouting obscure references to something that happened in the House of Assembly during a late-night sitting (not broadcast) in 1993.

Really odd stuff that even politcal junkies like your humble e-scribbler long ago forgot. But someone claiming to be a house-frau from Humber will be able to cite chapter and verse from a cabinet meeting minutes.

or they'll just repeat Standard Anti-Grimes Position Number 6. it's like they are little japanese soldiers deserted on some island, destined to carry out their last order unti, they pass out or are killed by a falling cocoanut.

And that's what some of it is like. A Marx Brothers movie.

Bizarre stuff, really, but it gets on the air. Most often at VOCM, but increasingly the planted callers - Progrsssive Conservative and Liberal - are turning up at CBC. Easy know there's an election coming up in October: the bulls**t is already so deep you need something by bodyglove to get through it without getting an infection

So if you want a convenient spotter's guide to the politcal flaura and fauna of Newfoundland and Labrador, check out WJM's labradore.

Here's a question to start your search through the local political jungle: what newspaper columnist, author and former Tory candidate actually claimed that in 1949 the Newfoundland government gave away all its resources and received a miserable allowance in return?

Hint: a collection of her greatest calls to Open Line will likely be titled: The other Gin and Tonic Gardener.

-srbp-