05 June 2009

Speech disappeared

For some unknown reason a speech delivered by Premier Danny Williams at an April 2008 Public Policy Forum testimonial has been removed from the organization’s website.  Williams was co-chair for the event. 

While the news release and the event notice remain, the speech has been disappeared. Speeches from the 2009 event are posted.

For those who’ve been following, that’s the speech in which Williams uttered the immortal phrase “counter-spinning negativity” to describe the stuff that keeps him up at night.

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Gas facility joints list of energy projects in NL on hold

CBC news is reporting on Friday that Newfoundland LNG has shelved plans for a natural gas transhipment facility at Grassy Point, Newfoundland pending improvements in world natural gas and capital markets.

There’s no other reporting of the decision nor does the company have anything on its website about the project since it received environmental approval last August.

Construction had been expected to start this summer, according to CBC.

The company was confident the project would start construction in early 2007 however there were reasons to doubt project’s future 2008, as Bondpapers noted in April, August and October.

This is the cancellation of the third major project for northern Placentia Bay.  A proposal to build a second refinery collapsed in 2008 and earlier this year, owners of the Come by Chance oil refinery announced that expansion plans for that facility were on hold indefinitely.

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Job losses in NL no paradise

The number of Newfoundlanders and Labradorians out of work in May 2009 compared to the same month last year is equivalent to almost the entire population of the Town of Paradise.

Some 12,000 fewer Newfoundlanders and Labradorians were collecting paycheques in May 2009 compared to May 2008, according to figures released Friday by Statistics Canada. Detailed tables show the losses and gains by economic sector.

Seasonally unadjusted figures show the changes by region, with central and the west coast of Newfoundland having the largest drops.  All regions recorded a decline in employment according to Statistics Canada.

In March, the provincial finance department projected only a modest decline in employment  - a mere 1.o percent - in 2009 compared to 2008.  The provincial finance department uses Statistics Canada figures in making its estimates.

Paradise is billed as the fastest growing municipality in the province.  According to the 2006 census, the town had a population of 12, 589.

Newfoundland and Labrador also posted the largest year over year percentage change in employment, with a drop of 5.3%.

Table:  Percent change in employment, May 2009 compared to May 2008,  seasonally adjusted, May (Source: Statistics Canada)

Newfoundland and Labrador

-5.3

Ontario

-3.3

Prince Edward Island

-3.0

British Columbia

-2.6

Alberta

-0.7

Quebec

-0.4

New Brunswick

+0.6

Manitoba

+0.6

Nova Scotia

+0.8

Saskatchewan

+2.6

 
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Update note (2129):  added links to detailed tables.

Bell 206 crash – photo interpretation

At approximately 2030 hrs local time, a Bell 206 belonging to Quinlan Brothers fish company crashed about 15 minutes east of Conne River on the south coast of Newfoundland.

The helicopter was apparently returning from a cabin in the Bay du Nord wilderness area when it crashed.  Three people remain in hospital in St. John’s.  They are reported to be in serious but stable condition.

nl-helicopter-crash-cbcThe Royal Canadian Mounted Police released a photograph late Friday of the scene.   

The Quinlan helicopter is in the foreground.  In the background is a Bell 206 belonging to Canadian Helicopters International.

In the picture at left (click on the photo to get the cbc.ca/nl story), it’s hard to see some of the detail.  The fuselage is intact, but the tail boom immediately aft of the fuselage is broken off  and one blade of the main rotor is apparently gone.  The helicopter reportedly struck a tree but it isn’t clear at this time from media reports if that caused the crash or was an incident that occurred while the aircraft came down due to another emergency.

The Telegram enlarged the main portion of the photograph.  Some of the detail is easier to see in that one.  We’ve added some coloured marks to help distinguish things a bit.

206 - conne river - marked

The red arrow points to the main rotor blade which is hanging by what appears to be a portion of the fibreglass material from which it is made. 

The yellow arrow points to the tail boom which sits pointed away from the fuselage, starboard side up.  You can make it out in between the top of the fuselage and the intact portion of the rotor blade. 

There’s no sign of the tail rotor at all but given the angle of this picture the thing could be intact but hidden by either the main fuselage or the tail boom.

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What drives current oil prices?

Some people will tell you that resurging growth in the Chinese economy is pushing oil prices up and will sustain high oil prices into the future.

That’s an interesting notion given the demand statistics.  take a look at daily consumption figures from nationmaster.com.  The figures here jive with a commentary by CBC Radio’s business consultant during an interview with On the Go’s ted Blade’s Thursday afternoon.

Now admittedly they are from 2007 but they show that American daily oil consumption is about thee times that of China.  Those figures have changed relatively over the past couple of years since both the American and the Chinese economies have taken a hit and the hits are connected.

There’s still an oil glut on the world markets, by the way, despite cuts in production at OPEC.

So why are oil prices high?

It seems that prices are relatively high for the same reason that helped drive oil to historic highs last year.  A weak American dollar coupled with questions about the American economic recovery are pushing speculators into the oil markets again. 

At some point, though, the markets will correct, just as they did last year. High oil prices will delay the American recovery and likely exacerbate the demand versus supply imbalance. In a world of tight money, the world can only sustain that situation for so long. 

At that point, just as in the mid-1980s, expect a second downward drop in oil prices after the initial steep slide.

Closer to home, that likely means any hopes of oil powering the provincial budget out of deficit might be a bit premature at best.  At worst, a dramatic drop in oil prices – like say to about half where it is now – or a delayed American recovery will only increase the deficit problem in the years ahead. 

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04 June 2009

Rio dumps Chinese, partners with BHP

Rio Tinto announced Friday that it is no longer pursuing its deal with Chinese industrial concern Chinalco. 

Instead, the company will launch a joint venture with BHP Billiton on iron ore assets the companies share in Australia.

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Anger, personified

The raw scrum video, via cbc.ca/nl of the response by Premier Danny Williams to an ongoing story at Eastern Health.  There’s also the full cbc.ca/nl online story on the ongoing controversy.  If that doesn’t work, try another link here:   http://tiny.cc/TEJTJ.

CBC news obtained documents through the province’s access to information laws that shed more detail on the release of information in early April related to the ongoing breast cancer testing issue.

Officials  - especially communications vice-president Jennifer Guy - at Eastern health,  New Democratic Party leader Lorraine Michael, all on the receiving end of the Premier’s anger including an accusation of  political opportunism on the part of the NDP leader. 

This is radically different from anything ever fired at people like Stephen Harper.  There’s none of the characteristic hyperbole, for instance.  You can feel the anger coming clearly through the audio portion. Eastern health chief executive Louise Jones held a newser later in the day;  that isn’t available online yet.

Williams recently criticised the province’s access laws for bogging down government officials with “frivolous” requests and used that an excuse for failing to deliver whistleblower protection legislation in the first session after the 2007 general election as Williams promised.

In a scrum with reporters last Friday, Williams also claimed there was not much experience globally with whistleblower protection laws

He also accused an unnamed witness at the Cameron inquiry into the breast cancer scandal of being motivated at least in part by a personal vendetta. Williams said someone “came on pretty strongly” and decided “to have a crack at government after they did not get their own way’ on employment for a relative with government.

Political opportunism by opposition leaders is not an unusual phenomenon in Newfoundland in Labrador, by the way:

“We told them it was only print-sharing and that there was no threat but, regardless of that, they did take the action they did,” he said.

“What happened wasn’t a breach. Their staff, we believe, knew it wasn’t a breach.”

The action referred to there by a police officer was a public accusation a Liberal political staffer had attempted to hack into the opposition Progressive Conservative computer system.

The story broke in early February 2002:

"The premier's office knew right away that this had happened and, in my opinion, they've acknowledged that a political staffer has interfered with our (computer) system," Conservative Leader Danny Williams said Friday.

"That's very serious stuff."

The language from then opposition leader Williams was strong and, as it seems people in his office knew at the time their version of the story was nothing that would warrant the over-the-top language their boss used:

"Here we have a political staffer trying to break into our computers," Mr. Williams added. "It's very disconcerting to us. There's strategic information in our offices."  [“Liberal tried to hack our computers, Tories say: Newfoundland probe”, National Post Richard Foot, Saturday, February 9, 2002]

or from a Telegram story headlined “Tories sweep offices for bugs”:

"An attempt at access is just as serious as access - no different than attempted robbery is as serious as robbery itself," said Williams, who is a lawyer.

"From our perspective, we're treating it as a very, very serious matter."

 

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03 June 2009

NS election: undecideds dominate

Forget what you’ve seen reported.

Take a look at the Corporate Research Associates quarterly poll results since early 2008, adjust them to take out the “percentage of decideds” skew and it’s pretty clear that no political party in Nova Scotia is lighting anyone on fire.
NS party
There’s what you get and it really isn’t pretty.

With the exception of the poll taken in the first two weeks of May 2009, “undecided” more Nova Scotians are undecided than are opting for any one of the three major political parties.
 
The New Democrats may wind up on top in next week’s vote, but that’s just the way the electoral system works.  It sure won’t be because there is any massive excitement among Nova Scotians for an orange option.  Blue and Red are in worse shape.

Leadership certainly isn’t a factor.  Sure, CRA asks which leader Nova Scotians prefer and sure the NDP guy comes out on top.

But when asked to rank the issues, leadership comes out as the big issue for a mere five percent of respondents in the poll done in the second half of May.

According to that poll, the top issues are health care funding (37%) and dealing with economic concerns (33%).  The next most frequently mentioned issue  - education funding – comes in at a mere 11%.

That’s interesting because the NDP are pushing Darrel Dexter above all in what has become a fairly typical “Big Giant Head” type of campaign.  But  - stealing an approach from the federal Conservatives - the Nova Scotia New Democrats are making seven key commitments.  The top two are the economy and health care.  Stephen Harper only needed five commitments, incidentally.

Ditto the Liberals, at least as far as making the party leader the centrepiece.  That’s a weird choice given that the guy doesn’t poll all that well in comparison to others and – if CRA is correct – the leader ain’t the vote driver. The Nova Scotia Grits also have seven ideas at the heart of their plan, the second and third of which are health care and the economy.

The Nova Scotia Progressive Conservatives are in trouble.  Google the party and the information that comes back claims the party is led by some guy named Hamm. If the party website can’t get any more up-to-date, then there are issues here that help explain the Tory’s consistently crappy polling and why they are likely to be headed for the opposition benches for a while.

The Progressive Conservatives play down their leader a bit – hint:  it ain’t Hamm -  which is understandable if the polling is right. The party platform has five core areas and the top one is the economy. The second one is also the economy, expressed as “rural development”.  The third and forth are about crime and “defending” Nova Scotia while the fifth is another traditional Nova Scotia economic engine:  the political pork feast of roads and infrastructure.

If you look at all three parties, neither of them is really hammering away at health issues or the economy, at least as far as their news releases are concerned. 

For an outsider watching the election from afar, media coverage wouldn’t suggest the election is a hot topic.  Take a gander at the Chronicle Herald website and find any highlight of election coverage. Try and find it.  CBC has the standard [Insert the name of the jurisdiction here] Votes [Insert Year Here] but the web space is nothing to write home about. those are just two.  The actual on-air coverage from the electronics, plus Connie TV’s Steve Murphy or Global might be different.

Something suggests, though, that the election isn’t turning anybody’s crank in a big way.

That, rather than the idea the New Democrats will be the government, might turn out to be the story next week:  “Nova Scotia had an election and they swapped one minority government for another;  see you again in a year or so.”

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NS election: Undecideds double in two weeks

The number of undecided voters in the Nova Scotia general election doubled in the second half of May compared to first half, according to two polls from Halifax-based Corporate Research Associates.

In a poll taken in early May only 17% of respondents were undecided or weren’t planning to vote.  In the second poll, 33% of respondents were undecided. 

The second poll covered a larger sample (834) than the first poll (627). The first poll was conducted from May 7 to May 16.  The second poll as conducted between May 18 and May 30.  CRA reports the margin of error for both polls as 3.9% for the first poll and 3.4% for the second, 19 times out of 20.

Support for the front running New Democrats dropped from 30.7% to 29.5%.  Liberal support dropped from 25.7% to 18.8% and Progressive Conservative support dropped from 23.2% to 17.4%.

Interpretation of the poll in conventional media relies on dealing only with decided voters. Thus, CBC concludes that “support for the NDP has risen sharply to 44 per cent from 37 per cent” while ignoring the change in undecideds.

There is no indication that Corporate Research Associates probes undecideds in the two polls, completed as part of CRA’s quarterly omnibus polling in Atlantic  Canada.

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Adios, Lisa

Not only did federal natural resources minister Lisa Raitt or one or her staff leave a three inch thick binder of confidential briefing notes at a CTV office, they didn’t try and get it back.

If that isn’t cause for dismissal, then there isn’t much left that is.

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02 June 2009

Lessons not learned, Part II: health department may have breached privacy law

Unless they’ve got written consent for the disclosure, the province’s health department violated several sections of the province’s Access to Information and Protection of Privacy Act.

A report by independent consultants on the location of a magnetic resonance imaging (MRI) device includes the home address and telephone number of one of the consultants as well as complete curricula vitae of the three consultants.

The original news release directed interested people to contact the department’s communications director for a copy of the report. The release issued Tuesday contained a link to the complete report, with the attached CVs.

The report was received on February 28 and released on June 2, in violation of a supposed government policy requiring reports to be released within 30 days of being received. 

Under section 30 of the Act, government must refuse to disclose personal information unless there is written consent. A similar provision is contained in section 39.

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Sectional Update:  The ever eagle-eyed among you noticed that since this document wasn’t released under the access to information bit of the legislation, section 30 doesn’t apply.

Correct.

Section 39 does and that confusion is purely mine in the way the post was quickly written.

The act covers requests for information PLUS privacy protection.  The privacy part containing s. 39 covers what government may do with personal information.  One of the things is not release it without permission.

It all comes out to the same thing.

s.39 of the ATIPPA applies in this case.  Without permission, they weren’t suppose to publish personal information.

Lessons not learned

“They should be shot over there.”

So said Premier Danny Williams when the public reacted angrily to a news release from Eastern Health late on a Friday afternoon that buried the kernel of hard news in the middle of the release.

Turns out senior government officials knew about the whole thing in advance, had a hand in drafting the release and that cabinet ordered the disclosure immediately, despite the objections of officials at Eastern Health.

The documents, released under the province’s open records laws, are available on the cbc.ca/nl website. Interestingly, they appear to have been processed electronically.  This is contrary to standard government practice in some departments which seem to favour using only hard copies as a way of maximising the cost to the applicant.

When asked in the legislature on April 5 (the first sitting day after the Friday news release) when he and officials of his department first learned, health minister Ross Wiseman initially ducked the question, talking instead about research done previously to identify all patients involved in breast cancer testing.

On the second and third questions, Wiseman finally relented, but claimed he had only learned of the matter on April 2, presumably at cabinet:

Yes, I was aware that they were going to be doing that release. The conversation that my office had with Eastern Health was midday on Thursday (April 2, the day cabinet met) , and the understanding and direction was pretty clear: that this information needed to get out immediately. The fact that they were late on Friday afternoon releasing it, I had no control over, Mr. Speaker. That was their call, their decision to release it. I received the notice of the release just moments before it was out. I was out of the Province on government business, meeting with my colleagues in Halifax and with other health regions.

Mr. Speaker, that was their call, but I would agree with the member opposite that getting a release out late Friday afternoon and not having anyone available from the organization to comment on it is not something that I would agree with either.

Wiseman is only referring here to the cabinet directive to release the information, not when his officials first learned of the issue.  The documents obtained by CBC place that time earlier that week. An e-mail from health deputy minister Don Keats shows the minister looking for a briefing on the subject on March 31.

Wiseman’s answers in the House on April 5 also leave the impression that government had no involvement in the matter:

I want to tell the member opposite and the members of the House, Eastern Health write their own press releases. They release their own communiqués. I was aware of the information that they had.  I was aware on Thursday that they were going to be releasing it. My understand was they were going to be releasing it quickly. I then went out of the Province on business, only to find that I got a copy of the release at the same time it was being released to the public.

That also wasn’t strictly accurate since, according to the released documents, cabinet had directed the release immediately without waiting until patients had been contacted directly.

By the following day of questions in the House of Assembly, April 6, Wiseman was acknowledging he had learned of the issue on April 1.

Speaking with reporters on April 5, the Premier condemned Eastern Health for releasing the information in the way they did including not disclosing the information to patients first. That’s the same scrum in which he uttered the infamous comment that “they” should be shot over there.

Justice Margaret Cameron, in a report released last month, found that Eastern Health had erred by not telling the whole truth of what it knew, Williams said. The premier slammed the authority for sending out information late on a Friday and then not making anyone available to talk about it immediately. He said patients deserve full and transparent disclosure.

"This is about people's lives … They have a right to be told," Williams said. "They have a right to be told in a proper manner. There has to be proper disclosure; there has to be someone there to answer questions. It's not something you do at the tail end of a Friday afternoon."

The documents on the cbc.ca/nl website do not appear to represent all the documents related to incident.  Missing are documents or any notes referring to having the issue placed on the cabinet agenda and what, if any communications there would have been between the department and Executive Council, the government’s central co-ordinating agency.

Some of the documents were written days after the event and around the same time Eastern Health’s vice president of communications engaged in a rather bizarre bit of public spinning about the location of information in the news release.  She wasn’t the only one spinning the story.

Coincidentally the week before the Premier said that people should be shot over the incident, courts in Ontario upheld the ruling that such language constituted uttering a threat.

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Williams invents excuse for stalling whistleblower law

In a scrum with reporters last week, Premier Danny Williams said he has instructed government officials to gather evidence on experience with whistleblower legislation because there  is “not much precedent” around the world for whistleblower legislation.

Nothing could be further from the truth.

The United States Congress enacted the false claims act of 1863 to protect the public from unscrupulous manufacturers who substituted sawdust for gunpowder in Union Army contracts during the Civil War. The legislation,  updated in 1986, allowed citizens to file claims against manufacturers and awarded the citizens – effectively whistleblowers – a portion of any subsequent award.

There are 18 other American federal statutes that contain whistleblower protection.

A 2002 statute, enacted in the wake of Enron, extended protection to private sector employees who blow the whistle on wrongdoing.

The US federal government has had a whistleblower statute to protect federal employees since 1989. The earliest such law for federal employees was enacted in 1912.

Most American states have protection for employees who disclose unethical or illegal acts by employers.

The United Kingdom has had whistleblower protection since 1998.

Various Australian states and the Australian Capital territory have whistleblower legislation.  The earliest dates from 1988.

The Government of Canada has had a whistleblower protection law since 2005 and in 2006, Manitoba passed a public interest disclosure statute.

Williams promised whistleblower legislation during the last general election, in 2007, saying:

The very first session of the House that we have, that's something we'll have a look at. As a matter of fact, there'd be no reason why we wouldn't get it on.

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01 June 2009

Who said that?

What about the principles of accountability of government and the reliability of the budgeting process? Why doesn't government just tell the people the truth? You, the people, have a right to know.

Who said that?

When?

Where?

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31 May 2009

Whatever happened to…

1.     The Sustainable Development Act (2007)?

2.  The Safer Communities and Neighbourhoods Act (2007)?

3.  The Court Security Act (2004)?

4The Health Research Ethics Authority Act (2006)?

5.  The International Interests in Mobile Aircraft Equipment Act (2006)?

6.  The Architects Act (2008)?

7.  Embalmers and Funeral Directors Act (2008)?

8.  Fire Protection Services Act (2008)?

9.  Promised legislation on midwifery to replace the act repealed last December?

10.  A gas royalty regime promised in the 2007 energy plan?

11.  A new oil royalty regime promised in the 2007 energy plan?

The Provincial Government will also establish a new Generic Offshore Oil Royalty Regime based on principles and structure similar to the Offshore Natural Gas Royalty Regime. In the case of satellite field developments that use existing field infrastructure, adjustments to the regime may be made to reflect the robustness of satellite field economics, including consideration of recoverable reserve size and the potential that costs of existing field infrastructure may have already been recovered.

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Williams afraid of whistleblower law

Forget all the excuses offered by cabinet ministers before about a whistleblower protection law being complex.

The real reason the provincial government hasn’t introduced whistleblower protection legislation as promised by the Premier is because the Premier is worried about what happens afterward.

Danny Williams told reporters on Friday he wants to make sure the law isn’t used by people who have “a personal vendetta against government.”  You’ll find that quote in a Telegram story from the Saturday edition that sadly isn’t on line.

Williams promised whistleblower protection two years ago during the last provincial general election campaign.  He apparently promised it swiftly suggesting it would turn up in the first session of the new legislature. 

In his report on the House of Assembly spending scandal, Chief Justice Derek Green called for whistleblower protection.  Green described such protection as “internal [government] policies designed to encourage internal enforcement of ethical behaviour.” 

Green linked disclosure to public confidence in government and cited federal legislation introduced in the wake of the sponsorship scandal. Green also linked whistleblower protection with open records laws as a means of promoting public confidence in ethically sound government.

Two years after Green’s report and Williams’ promise and three years after the House of Assembly scandal first broke, there’s no whistleblower protection laws.

Williams linked whistleblower protection to access to information laws but not in a positive way.  Williams told reporters that his senior staff are consumed with vetting access to information requests Williams termed “frivolous”.  He said he was concerned that whistleblower protection could “create another situation where we're going to put a stranglehold on government.”

Whistleblower statutes like the one proposed by Bond Papers specifically define the types of incidents covered by the disclosure and provide a mechanism for investigation allegations by an independent third party. 

Under the Bond Papers bill, based on the 2006 Manitoba public interest disclosure law, the legislation would apply “to the following wrongdoings in or relating to the public service:”

(a) an act or omission constituting an offence under an Act of the Legislature or the Parliament of Canada, or a regulation made under an Act;

(b) an act or omission that creates a substantial and specific danger to the life, health or safety of persons, or to the environment, other than a danger that is inherent in the performance of the duties or functions of an employee;

(c) gross mismanagement, including of public funds or a public asset;

(d) knowingly directing or counselling a person to commit a wrongdoing described in clauses (a) to (c)…

There is no room for a personal vendetta.  The acts subject to disclosure are all in the public interest and it’s hard to see how anyone could consider disclosure of such lawbreaking as part of a personal attack by the whistleblower. of course, attacking the motives of the whistleblower is part of the climate frequently used to discourage disclosure in the first place.

The draft law allows for disclosure of wrongdoing to an official designated in each department or to the Citizen’s Representative.  Green used the Manitoba legislation in drafting his report.

Green noted the potential that whistle blowing laws could lead to some risk for politicians.  However, Green said that a thorough and independent investigative process “should, however, screen out unfounded allegations of a vindictive nature.” 

Green also said the public value of restoring confidence in government outweighed such issues:

I do not believe that a concern of this nature is sufficiently strong to overbalance the other benefits of implementing such a policy, particularly the removal of public suspicion that MHAs have something to hide and the bolstering of public confidence in the open and transparent nature of the political system.

Williams disdain for public access to government information isn’t new.

Early in his administration, Williams tried to withhold polling results even though provincial open records law specifically listed them as being subject to disclosure.

More recently, government officials successfully stymied a request for e-mails by essentially inventing excuses based on how much information was covered by the request and how much time it would take to process the request.

In another example, requests for specific documents were denied on the grounds that the documents didn’t exist even though government officials acknowledged the records actually did exist.

In that case, Williams went so far as to call personally the reporter making the request to complain about the fact the request had been appealed to the province’s information and privacy commission.

In January 2009,  a survey by the Canadian Newspaper Association showed that the provincial government didn’t fully respond to any of six specific information requests used in the study. A request for information in electronic format (Excel or a similar spreadsheet program), netted a bizarre but increasingly typical response:

The letter from the Transportation and Public Works department in Newfoundland stated that the information “does not exist in electronic form within this department,” even though the record released was a computer printout.

The provincial government is also sitting on information related to a review of inland fisheries policy that has been ongoing for an unknown period.

Even requests for information not handled through access to information laws have run into stone walls.

The natural resources department refused to answer questions about compensation talks with Abitibi over expropriated assets because there were compensation stalks with Abitibi over expropriated assets.

The same department also refused to give any details of the minister’s trip to Ottawa last winter.

As for the claim about how much time is consumed vetting requests, testimony last year at the Cameron inquiry into the breast cancer testing scandal revealed that some of the reasons staff spend so much time on access requests involves vetting public information. 

In one notorious example, the name of a judge presiding over a case which had been reported in the news media was redacted for an access request. The same approach came to light in a report on the provincial prisons service only because government officials mistakenly released a copy of the document electronically with faulty redactions.  None of the information blacked out actually met the disclosure exemptions under the provincial access law, but they were blacked out any way.

If there is a “stranglehold” on government, it seems to be coming from intense and persistent efforts to avoid public disclosure of government information under provincial laws.  Adding whistleblower legislation wouldn’t add to that and the provincial government itself can avoid getting strangled by reducing its self-imposed efforts at secrecy.

Perhaps they should take a cue from Chief Justice Green.  After all, he did say that implementing open records laws and protecting whistleblowers would bring benefits, “particularly the removal of public suspicion that MHAs have something to hide.”

All the foot-dragging and such does make one wonder.

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Update:  The online CBC version of the story with a link to a David Cochrane report.  This is by no means as complete as the Telly story and the interpretation is more than a bit generous to the Premier.  His juicy quotes about access to information, for example,  are clipped in favour of his throw-away line about how important ATIPPA is.

30 May 2009

How Icelandic are we, 2009 budget version

According to the Premier the relatively high price of oil at the moment is a good thing, with the prospect that it could wipe out the provincial government’s budget deficit. [Update:  an online story via CBC about the Premier’s comments.]

But could it?

Right at the start, everyone should recall that provincial revenues from oil are a function of the price per barrel of oil and total annual production.  The provincial royalty is a percentage of what you get when you multiply how much oil is sold by how much you get for each barrel.

So let’s look at production.

The provincial 2009 budget low-balls oil production.  It hit 125 million barrels in 2008 and while Dominion Bond Rating Service forecast a 15% drop, the provincial finance department forecasts a 21% drop to only 98.5 million barrels.

In the first month of the fiscal year – April – total oil production was slightly more than 9.1 million barrels.  At that rate, the offshore would produce 109.2 million barrels in 2009.

Compared to April last year, oil production is only down about 10%.  That means that the provincial production forecast could be off by more than twice the actual decline. 109 million barrels would represent a 13% decrease from 2008 – right in line with the DBRS estimate.

Then there’s price.

The budget forecast oil at US$50 a barrel on average.  Currently Brent is trading at about US$65 a barrel.

Sounds great, until you factor in the hidden gem:  the relative value of the Canadian dollar.  When the Canadian dollar is weak the provincial government can pick up a nice little premium by selling in American and then doing the conversion. 

At budget time, the Canadian dollar was worth a lot less.  As a result, that price of US$50 a barrel worked out to be around Canadian$60 to $62.50.

Brent crude is currently trading  at Cdn$71.50.  That’s because the Canadian dollar is trading at almost US$0.90. 

If you do the math on that – using today’s Brent price plus the more likely oil production level  - the whole thing works out to roughly $1.5 billion in oil royalties for the provincial treasury.  The budget forecast was $1.262 billion based on a smaller amount of slightly cheaper oil.

Meanwhile, the cash shortfall is $1.3 billion. Oil revenues would have to double, as they pretty much did last year, in order to wipe out the cash shortfall if the dollar hangs around its current treading level.

Even coming up with an extra $500 million or so on top of the extras already attained would mean you’d have to see the price of oil go higher still and the Canadian dollar slide down as well.

That might happen.

Then again, in the current environment, it doesn’t seem very likely.

We’ve been in this sort of dream land thinking before back in the spring when the budget came down. Back then, we used a higher oil production figure and a much weaker Canadian dollar in order to generate an extra $600 million in cash or thereabouts. 

But an extra $1.3 billion? 

Or even $750 million?

That would be pretty hard especially when other commodities like fish and minerals aren’t doing that well either and the forest industry in the province is shrinking faster than the family jewels on a crowd of Scandinavian men running from the sauna into an ice-covered pond.

At the very best, any optimism or pessimism about where the provincial deficit will wind up this year is a wee bit premature.  At the worst, reporting any sort of government speculation about revenues is irresponsible.

After all, these guys sat on a couple of billion in cash they never bothered to mention until this year.  It’s not like the provincial government has a sterling reputation when it comes to disclosing the facts of a matter.

 

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29 May 2009

Everything old is new again, fisheries version

From the New York Times, November 2, 1889, quoting a report by the Newfoundland Chamber of Commerce:

The lobster fishery has been expanded and is now a valuable factor in the exports of the colony “but it is much to be feared that indiscriminate fishing is injuring this industry.”

Then later:

A fisheries department has been organized and it has obtained a Superintendent for the work of artificially replenishing the cod stock.

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Newfoundland pre-Confederation trade, a snapshot

As reported by the New York Times, 1889

Exports:

Destination

Amount (US $)

Brazil

1,325,080

Portugal

1,198,392

United Kingdom

607,007

Spain

556,554

Canada

482,497

France

349,732

Untied States

327,925

Imports:

Origin

Amount

United Kingdom

3,265,229

Canada

2,041,044

United States

1,602,138

Interestingly enough, by the late 1940s, the United States had become the major destination of Newfoundland exports while Canada was the chief source of imports along with the United States and the United Kingdom.

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Great Quotes by Rhodes Scholars in Newfoundland (abridged)

1.  Bill Clinton, Mile One Stadium, St. John’s,  28 May 2008

All of us need to think of our citizenship in terms of what we can do in our communities and halfway around the world.

2.  Danny Williams, Mile One Stadium, St. John’s, 07 April 2001:

I say to Newfoundlanders and Labradorians: "Ask not what we can do for our country, because we have done enough. Let's ask our country what they can do for us."

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