Did Williams fatten charity with allowance?

Since first confronted with the Auditor General's revelation that members of the legislature took a retro-active bonus in 2004, Premier Danny Williams has contended that it didn't apply to him as he does not take a salary.

His language has grown carefully precise but potentially misleading. Williams states that he did not take or receive the money personally.

Many people, including most reporters, have interpreted this to mean that Williams did not take the money full stop. Williams' publicist told the Telegram the Premier did not use the money - not because he takes no salary - but because, as the Telly attributes the remark, Williams "had sufficient constituency funds available.

The latter comment was made before the rest of us realized or were made aware that the House of Assembly actually had already overspent its budget by $350,000. Rather than provide reimbursement on a case by case basis, the House of Assembly's executive committee - controlled by three of Williams' senior ministers - opted to give everyone a retroactive bonus. The additional $2800 applied to the previous fiscal year and was not issued on the basis of receipted expenses.

On Friday, Danny Williams admitted he learned of the payment sometime after it was approved, but did nothing to stop it until public outrage reached its current peak. Williams' parliamentary assistant and one of his ministers tried to justify the retro-cash with no success on Thursday.

The key point to recall is that Williams in fact does collect a salary and routinely avails of allowances and other stipends from the House of Assembly.

The question to be answered is this: Did Danny Williams not receive the bonus at all or did he take and turn it over to the Williams Family Foundation?

The former is what people have assumed. But we have all made grave errors in doing along with what we assume Danny and others have meant when what they said was actually very different.

The latter would be entirely consistent with the Premier's language and with established practice of donating his salary and stipends to his family charity. It would also explain - more than anything else - why he simply kept his mouth shut about the thing. And too, since he had actually taken the money, it would explain the Premier's reluctance to admit when he knew about the bonus and why it took him three years and the ire of voters across the province to realize the allowance was a bad thing.

The Auditor General knows who got the money and who didn't.

Maybe he'd tell us, if someone asked.

Friday Follies

This wasn't there last night when Bond posted last night on advertising.

But overnight, this turned up on youtube.com.

It's funny.

Hibernia South veto has consequences

Bond Papers linked to the offshore board documents on Thursday, but the Telegram's Moira Baird does a much better job of covering the Hibernia South story here.

The offshore board noted the implication inherent in government's decision - namely that the approvals process would take longer on future projects.

Industry representative Paul Barnes concurs:

"From the industry’s perspective, this will mean it will take longer to get projects approved," said Paul Barnes, Atlantic Canada manager for CAPP in St. John’s.

"This flies in the face of what we’ve been working towards with governments over the last few years in trying to shorten timelines for regulatory approval."

Barnes says the Hibernia South decision erodes efforts to create a "single regulatory window" and increases uncertainty about the rules for Newfoundland offshore developments.

"It’s causing a lot of confusion,” he said. “You’ve got to have certainty around the regulatory regime because it has an impact on who invests here, why they invest and when they invest."

Advertising highs and well...ummm...

For SuperBowl Sunday (now that I know when it is!), here's a spot that remains one of the best SuperBowl spots ever run. This one comes from Pirate Radio and Television, which regular readers of Bond Papers will know is home to Terry O'Reilly's creatively warped cranium. Here's the link to O'Reilly's blog supporting his CBC radio show, Age of Persuasion.



On another level entirely are these spots coming from some pseudonyposter on youtube.com and aimed squarely at the local political market.

These showed up at the Bond e-mail just as they seem to have shown up in a bunch of other inboxes. Despite the fact the first one has had almost 8,000 hits and managed to make both vocm.com and NTV evening news, your humble e-scribbler isn't sure if they are hitting anything other than a novelty.

Nonetheless, here is the latest one: a karaoke version of an old Frank Sinatra song, rewritten to reflect local content.

This kind of guerrilla advertising is likely to spread as the technology to produce video of a reasonable quality grows more accessible.

Boston "guerrilla marketing" stunt: a dumb idea

The publicity stunt that set Boston police bomb squads hopping on Thursday was not a guerrilla stunt so much as a case of some monkey tossing his own...well, you know.

If convicted, the two twits misunderstood creative geniuses will fit right in; jails are full of stupid people victims of society.

Successful crooks never get caught.

And smart marketers don't screw up in the first place or compound their error with a totally lame news gaggle in which they talk about "hair" questions.

Alberta oilpatch keen on Norwegian offshore

From CanWest:

Canadian-based companies went to town Tuesday in Norway's offshore oil and gas licensing round, snapping up 13 of 49 parcels offered in the world's third-largest petroleum exporter.Petro-Canada led the way by gaining interests in seven blocks; Nexen Inc. had four and Talisman Energy Inc. came away with two.Half a world away, local analysts said the Norwegian North Sea offers potentially big discoveries for homegrown players operating in a mature oil and gas region....

So why aren't they looking at Newfoundland and Labrador?

Maybe this has something to do with it:

Though the state oil company Statoil controls about 60 per cent of the country's production, Norway has been liberalizing its fiscal regime to offset declines and attract new exploration.

Knowles compared it to competition between the governments of Alberta and Saskatchewan to attract drilling dollars in their respective jurisdictions. "The same kind of thing happens between the U.K. and Norway."'

Fuelled by a royalty holiday on new discoveries, the European North Sea has become a hot spot for Canadian companies operating abroad.... [Emphasis added]

Around here, Danny Williams keeps pointing to the Norwegian example.

Well, apparently he doesn't understand how Norway really works.

Army reserve stretched by Afghan mission

Reserve army commanders told the Senate committee on national security that continuing the Afghan mission beyond 2009 will put increased pressure on reserve army units for training and recruiting.

Military family support centres opens in Corner Brook

With the deployment of nine reservists from second battalion of the Royal Newfoundland Regiment, the Gander Military Family Resource Centre is opening an office in the west coast city.

Dunderdale wrong on offshore board and Hibernia South

The Canada-Newfoundland and Labrador Offshore Board today released (click "what's new", once at the CNLOPB site) correspondence between the board and the provincial government on Hibernia South.

In total, the correspondence, including the formal reply to natural resources minister Kathy Dunderdale's letter of January 17, 2007, demolishes every contention by the provincial government on the proposal and on the board's actions.

Among the choice comments: "The Board's Decision [sic] actually goes a step further by requiring that the agreement [commercial agreement among the proponents] be approved by the royalty owner, i.e. the Province, before it will be acceptable to the Board."

That's right: there would have been no production unless and until the provincial government was satisfied on its financial issues.

So much for Dunderdale's spin that she rejected the decision merely to seek "more information".

March Madness starts early

Danny meets with European journalists to talk up the seal hunt.

Q. What do the following have in common?

Anna Nicole Smith
Loretta Swit
Pam Ferdin
Elizabeth Berkley
Danny Williams

A. All use the seal hunt to boost their careers.

A New Approach to roads maintenance

From the AG's report on government spending and operations:

In 1996, we concluded that the Department was not adequately managing the Province's road system. A decade later in 2006, we have come to the same conclusion.

A make-work slush fund in an unaccountable government?

From the AG's report on a make work program in the municipal affairs department:

Because the Job Creation Program was funded through special warrants and intra-departmental transfers from other programs, there was no opportunity for the House of Assembly to debate and consider funding requirements for the Program. Furthermore, although officials indicated that funding allocation was made by electoral district, there was no documentation available to show how much was allocated to each district or the basis for the allocation.

and then this:

There was no documentation in the files outlining the rationale for funding approvals.

Openness, accountability and transparency in an administration that brings a genuinely New Approach to government.

Pull the other one.

AG reports deficit and surplus at same time for same agency

Auditor General John Noseworthy released his comprehensive review of of provincial government spending and management today.

There is some new information about the House of Assembly scandal, including admission for the first time that Noseworthy's review started in January 2006. That's six months before the first public acknowledgement a review was underway. Bond Papers will have more on this in the days ahead, including some comment on Noseworthy's misunderstanding of the provincial constitution.

One curiosity in Noseworthy's summary booklet: in a section on educational spending, Noseworthy suddenly reports on deficits for health care boards:

(c) Operating results

All 5 boards reported operating surpluses for the year ended 30 June 2006 totalling $5.1 million. Operating surpluses ranged from $349,000 for the Labrador-Grenfell Regional Integrated Health Authority to $2.3 million for the Eastern Regional Integrated Health Authority. Because of inconsistent reporting periods resulting from the restructuring of school boards in 2004, comparisons with prior years' financial results would not currently be meaningful. It will be next year before effective and meaningful comparisons can be performed.

This produces an odd set of conclusions, since in the section on health authorities, the Labrador-Grenfell board goes from an operating surplus in the section quoted above to an unspecified deficit:

During the year, all 4 boards reported operating deficits totalling $11.0 million. Operating deficits ranged from $400,000 for the Western Regional Integrated Health Authority to $5.6 million for the Eastern Regional Integrated Health Authority. One board, the Labrador-Grenfell Regional Integrated Health Authority, reported an annual operating deficit higher than that reported for the fiscal year 2005.

Hmmmm.

This is no small discrepancy nor is it an easy cock-up to make. The names of the respective health care and educational authorities are different for one thing. Of course, the report is exceedingly lengthy at some 475 pages but there is a huge staff at the Auditor General's office including a new "information" manager.

Prems cancel meet fearing Equalization "bunfight"

The Council of the Federation meeting on February 7 will now take place via conference call instead of the face-to-face session originally planned.

The official reason is that there were scheduling problems. That doesn't hold water since Premiers were well aware of the meeting well in advance. Scheduling problems wouldn't be eased by a conference call, especially if the agenda was as extensive as previously claimed.

Initial media reports suggest the meeting was cancelled out of concern it would turn into a "bunfight" over Equalization.

In October 2004, Premier Danny Williams - the current chair of the Council of the Federation - stormed out of a meeting on Equalization, ostensibly to express his rejection of a federal proposal on offshore revenues. Other reports suggested the dramatic exit was to avoid - at least in part - criticism from other premiers of his approach.

Hibernia spat led to better royalty regime

In 2000, the Government of Newfoundland and Labrador vetoed an increase in production rates at Hibernia but subsequently approved the hike based on a better royalty agreement with the operators.

Then-energy minister Paul Dicks delivered a statement on the decision to the House of Assembly on April 10, 2000. In the statement, Dicks said that "[i]f the production increase had been approved, more oil would have been taken from the field at a lower royalty rate. Over the life of the project, this would have negatively impacted royalties to the province."

The production rate increase had been approved by the Canada-Newfoundland and Labrador Offshore Petroleum Board based on an application by the Hibernia operators

One difference between the 2000 decision and recent rejection of the Hibernia South development application is the speed with which government acted. Dicks initiated discussions on the application as soon as the offshore board decision was forwarded to government in early March. No agreement was reached within the 30-day window for approval set under the Atlantic Accord (1985) implementation acts.

In the Hibernia South case, apparently, the provincial government did not initiate contact with the operators nor, apparently, did it raise concerns over incomplete information in the Hibernia application until after the project application was rejected.

The provincial government has still not indicated its goal for Hibernia South. Industry sources suggest the provincial government is seeking to treat the 300 million barrel development as a new project which would involve a new royalty and benefits agreement and a new production platform.

The operators reportedly wanted to bring Hibernia South onstream in 2008 and, as Petro-Canada chief executive Ron Brenneman put it, "step out into the more prolific and better return prospects" while boosting production rates back to 200,000 barrels a day, the rate established in 2004.

In the 2000 disagreement, talks continued beyond the 30 day mark and an agreement was reached that June. Under the new deal - a supplement to the original Hibernia agreement -

"The royalty rate will increase above the current two per cent to three per cent earlier. It will then move to four per cent and five per cent after certain cumulative production levels have been reached. This will result in higher royalties than under the time based system,...This method of dealing with royalty rate increases is consistent with Terra Nova and the generic royalty regime in place for White Rose and future offshore projects."

Dicks said the original Hibernia royalty agreement remained in place and would "act as a floor to ensure that if production declines, rate increases will occur in any event."

Another major difference between the 2000 and 2006 disputes involves project pay out or the point at which the provincial royalty rises to 30% per barrel. In 2000, the provincial government secured a revised royalty regime that allowed the project to pay out around 2011, according to some estimates. Dicks noted in his statements that under the original regime, pay out was unlikely.

In 2000, total reserves at Hibernia were estimated at 1.2 billion barrels, including oil already produced. By 2006, total reserves estimates had reached 1.9 billion, the bulk of which would remain to be produced after pay out.

Treating Hibernia South as a new project would likely restrict provincial royalties to a lesser amount for an indefinite period and might delay pay out on the entire project. A new production platform would not be needed to extract Hibernia South, except in response to a political demand.

____________________

NOTE 1: Bond Papers previously reported that the Hibernia South rejection was the first time a provincial government had overturned a fundamental decision by the offshore board. In fact, it appears to be the second, except for the differences noted above.

NOTE 2: In the ministerial statement, Paul Dicks said: "To date, government is not satisfied that the province is being kept whole." Aficionados will recognize "keep whole" or "kept whole" as a favourite phrase of the current Premier.

Cable companies expanding phone services nationally

In Newfoundland and Labrador, that means your tax dollars at work.

Fish processing worker background

Some quick references on the issue:

1. An analysis by the Atlantic Institute for Market Studies, 2002. An extract:

Newfoundland has almost 140 fish plants, and up to 20,000 fish plant workers. Although some of the plants are highly automated, highly efficient operations that produce year-round. (National Sea's Arnold's Cove plant and Beothuck Fisheries’ Valleyfield plant are examples of a modern year round fish processing industry.) Many of the rest were put there for political reasons, often paid for by tax dollars, an often barely able to give their workers the 420 hours needed to qualify for 34 weeks of employment insurance....

The pulp and paper industry in Newfoundland has only 60% of its 1972workforce, while the fishplants employ twice as many as they did in 1972. Even the number of loggers is down by almost50%, while the number of fishermen continues to climb. In 1972 the Newfoundland unemployment rate was eight per cent. Since the advent of the "stamp fishery" and easier EI it has averaged between 15 and 20 per cent. A good quarter of that unemployment is directly attributable to the "stamp fishery."

2. From 2004, a short news release from then-fish minister Trevor Taylor. An extract:

Work at fish plants tends to be short-term in rural areas where employment opportunities are low and unemployment rates are high. The Fish Processing Policy Review Commission, under the direction of Commissioner Eric Dunne (Dunne Report), found that in real terms plant workers' average employment income in the province had declined to $9,660 in 2001. The outlook for plant workers is unclear given that technological innovations continue to reduce the labour demands of the fishing industry.

3. A typical Williams administration response, to date. The federal government has followed the same approach.

The Government of Newfoundland and Labrador will provide an additional $2.4 million to assist fish plant workers who will likely not secure sufficient hours to qualify for Employment Insurance. The Honourable John Ottenheimer, Acting Municipal Affairs Minister, today announced the funding to meet employment support needs in the province’s fishery.

4. Fishery reports. The problems have been studied - a lot; here are just two.

Williams: is he completely nuts?

It's not like people haven't called him nutty nutty nutbar before.

It's not like his behaviour hasn't grown somewhat erratic lately, (think John Hickey in and out of cabinet).

Forget his glee at demolishing the largest fishing company in Atlantic Canada. Is it really a "golden opportunity"?

Now Danny Williams claims that the fish processing sector will collapse within five years if we don't start importing labourers from other countries at high speed.

This is one bizarre claim, given that Williams knows full well the processing industry needs to shed workers at high speed to restore profitability. There are way too many workers chasing too few fish. Wages are dropping. Hours of work are dropping and in some plants work is going begging because it simply isn't worth people's while to drive to another community for the measly few hours work involved.

Don't just believe it because you read it in Bond Papers.

Believe the head of the hunter-gatherers union, Earl McCurdy, who has been busily working to get both the federal and provincial governments to pony up for an early retirement package.

Believe Danny Williams who only last year - that's right - last year was writing to the federal party leaders trying to get their support for yes, an early retirement package for workers. In fact, an early retirement package was the very first thing Williams went looking for from whoever became Uncle Ottawa.

So is he nuts?

No.

By Danny Williams' own account he was caught in a conversation with other premiers and a reporter about immigration. Other provinces are farther ahead in handling the immigration issue.

Around Bond Papers, it looks like he got jammed up in a scrum, felt the need to offer input and in the classic four Yorkshireman way, basically said we'd have to get our immigration act in gear because if we didn't: Armageddon.

Well instead, Danny winds up looking like all his bags were packed and he's ready to go, leaving on a jetplane to Looneyville.

And for those who think we will wind up importing Bulgarian fishwomen like they've done in the Martimes - just because they've done it in the Maritimes - think again.

They don't have the humongous surplus of capacity we do. The numbers vary but Bond Papers can find people who will tell you that we can actually produce a thriving industry with merely 10-20% of the 100+ fish processing plants dotted around the island portion of the province.

Fewer than 20 plants.

If the early retirement thing works, there will be negligible demand for labour beyond what can be supplied by the local labour market.

Now comes the tricky part.

If the provincial government would get out of the way, the fish processing sector could sort itself out and find new markets and new production ideas that require fewer workers. Unfortunately the current provincial fish minister [right] thinks he's still in the 1980s. He busily piles on regulations designed to frustrate the marketplace, drive up costs, and in the case of Fishery Products International keep the economic pressure on a company that would have righted itself long ago were it not for the provincial government's neglect or as one suspects, outright mischief.

No, Danny is not nuts.

Well, not drooling on himself, need a straight-jacket, barking like a dog, hearing voices, up his meds kinda nuts.

Danny Williams just has this habit of pulling things out of any available orifice when he feels the need. When Danny gets caught telling fibs... bullshitting bigtime... in a slight exaggeration he busily tries to explain away the apparent lunacy of his statements with a bunch of words.

Sadly, in this farce, the Premier has enablers: like Paul Oram, his current parliamentary assistant, who seems to have no function other than laud the Premier's magnificence in hopes that the Premier will elevate Oram to a cabinet stipend.

Sometimes it works. Sometimes, as in this instance, it doesn't. We are now in Day Two of Immi-gate and already we have the provincial fisheries department saying it has no studies on labour demands in the processing sector, even though Williams claimed to have read said studies.

And the story of the serious questions about the Premier's sanity comments is running nationally on CBC, hot on the heels of the recent trip out west by the Four Yorkshiremen.

Ooops.

The story likely won't last past today, however. There is always something else around these parts and tomorrow it will be the Auditor General's latest overall review of government spending.

Meanwhile, the fishery problems will slip back into the gloom, taking with it the thousands of men and women who continue to languish.

Home is where the money is

The Fort Mac take on the recent trek by four Atlantic premiers.

While one woman in the crowd complained she was forced to move to Fort McMurray 10 months after the Abitibi paper mill closed in Stephenville, N.L., another transplanted Newfoundlander said he has no desire to return home.

‘‘I think they should go to Newfoundland with empty buses and bring them up here,’’ said Lee Perkins, who’s now in charge of Fort McMurray’s water and sewer lines.
‘‘I’m easily doubling my pay here, and where my university-educated wife and I were working back home, someone had to die or retire for us to move up in our jobs,’’ Perkins said.

Lower Churchill: old news makes news

CBC Radio is quoting a mainland analyst that exporting Lower Churchill power will likely mean an upgrade (expansion) of the electrical power grid in Quebec.

Nothing new in that.

As Bond Papers noted in August 2006, the joint Ontario/Quebec proposal to work with Newfoundland and Labrador on the Lower Churchill included upgrading the transmission capacity across Quebec as well as upgrading the inter-provincial connection. The latter cost, in particular, was to be borne by Ontario and Quebec.

As noted by Bond at the time, all those costs - known and predictable at the time the Premier decided to "go-it-alone" - will now be borne by Newfoundland and Labrador Hydro.

The other option - the $2.0 billion plus underwater route - is apparently also under consideration, as CBC reports in a comment from provincial natural resources minister Kathy Dunderdale.

About the only way to deal with this issue and thereby allow the Lower Churchill power to get to market at competitive prices is to get the federal government to underwrite the costs somehow. In October 2006, Bond Papers pointed out that the federal government wasn't interested in loan guarantees for the Lower Churchill, despite what the Premier claims. Rather, the federal interest- if they have any at all - would be in taking an equity stake.