BC Hydro

Private contractors dependent on public money

1 backpack 250Paul Starr of Princeton University wrote The Limits of Privatization. In the paper, he discusses an effect in which influence on government now comes from the “enlarged class of private contractors and other providers dependent on public money.” 

When political parties are financial dependents and officials enjoy a revolving door between private industry and the public sector, the influence mentioned by Professor Starr grows to the point that it dictates policy and results in privatization of tens of billions of taxpayers’ dollars.

Disaster has been the result in Canada’s massive electrical utilities. Consumers in Newfoundland and Labrador, Ontario, Manitoba and British Columbia face punitive rate increases after very good times began to roll for private contractors.

Terry Roberts is a journalist with CBC’s bureau in St. John’s. With the experience he is gaining at the Newfoundland and Labrador hydropower inquiry, CBC News may want him moving to Canada’s west coast when the inevitable inquiry into Site C is convened.

Information from Mr. Robert’s recent reporting:

A stinging audit…, September 30, 2018:

…There was the release of a stinging audit by Grant Thornton into the decision to sanction Muskrat Falls…

That Nalcor was overly optimistic in the future demand for electricity, and used economic forecasts from the provincial government that were much rosier than similar forecasts from other sources.

The audit also questioned Nalcor’s aggressive cost estimates, which came with a 50 per cent probability factor that they would be accurate…

No evidence that cost estimates for Muskrat Falls were reviewed, inquiry hears, October 3, 2018:

A co-counsel with the Muskrat Falls inquiry says a search for government reviews of Nalcor cost estimates for the troubled project have so far come up empty.

Lawyer Barry Learmonth asked Danny Williams on Tuesday if he had any advice about where to find evidence that various government departments scrutinized the work of Nalcor.

“We’ve searched for reviews, reports and analysis that may have been prepared …​ and we haven’t found anything at all,” Learmonth said during discussions with Williams as the former premier concluded two days of testimony before the inquiry…

As premier, Williams led the charge to develop Muskrat Falls, culminating with the announcement in November 2010 of a partnership between Nalcor and Emera Inc. of Nova Scotia. The deal was inked just weeks before Williams retired from politics.

Construction costs at that time were estimated at $5 billion, and by the time it was officially sanctioned in 2012 by Williams’ successor, Kathy Dunderdale, estimates had climbed to $6.2 billion. Six years later, construction costs have climbed to $10.1 billion…

Wade Locke regrets Muskrat Falls involvement…, October 9, 2018:

Memorial University economist Wade Locke testified for three hours Tuesday at the Muskrat Falls inquiry.

The Newfoundland and Labrador economist who very publicly endorsed the controversial Muskrat Falls hydroelectric project says he never should have waded into the debate…

Locke delivered a presentation in late 2011 — a year before the project was sanctioned — in which he concluded that Muskrat Falls was the best option for the province’s electricity needs.

It came during the height of debate as the provincial government and Crown-owned Nalcor moved ever closer to sanctioning the project, which is now billions over budget and years behind schedule…

Locke said at the time he was “not being paid by anyone to undertake this research and I do not represent anyone but myself.”

Inquiry co-counsel Barry Learmonth challenged Locke on this point, asking whether Locke should have disclosed at the time he was working as a consultant for government and Nalcor on various contracts, including an income and employment benefits study of Muskrat Falls…

Documents show that between late 2013 and mid-2016, Locke’s consulting company was paid more than $600,000 by the provincial government…

Locke was hired by another consulting company — Strategic Concepts — that did work for the province and was paid nearly $160,000 between 2009 and 2015…

Categories: BC Hydro, Site C

10 replies »

  1. Muskrat Falls is so like Site C.
    So like the Dams in India as well protested by the writer Arundhati Roy. Socially sophisticated people who don’t think reality is an issue to be concerned about.
    Purely social.
    They have been to school however.
    For Muskrat Falls the cost went from 3.1B to 12B+ with no oversight done by the politicians. Trusted until busted socially speaking.
    Mr. Locke seems now to regret being compromised in his academic integrity by the social leaders for Muskrat Falls.
    Who can afford this social?
    And the media is an accomplice in this social.
    New rules for the media to have a business licence in our society ought to happen.
    New civil laws to prosecute these mutant politicians [ Nalco] with.
    Punishment would be cooking meals for the homeless.
    We never voted them in or were given the chance to discuss this private/public relationship in any political debate by any party.
    You can’t say its free enterprise versus socialism any longer.
    A different game is now on.
    Free to pillage without having an imagination is more like it. Plunder the Thinking of Socially Conscience people. They are helpless with our rules.
    We create, they profit must be the tune of their slogan sung on the way to the bank.
    What about the issue of intellectual property for us?
    Not even on the adgenda.
    What kind of weird prison we’ve found ourselves in.
    Time to upset these pirates.
    But how?
    Hugh

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  2. Private contractors being paid by governments are the new leaches on society.

    All this is, is legitimization of corruption, where friends of the government become highly paid contractors.

    Liked by 1 person

  3. The practice of sole sourced (design engineer & build) contracts being awarded to a single entity only really benefits the entity, all other associated parties lose, every time. Capital projects never come in on budget, contingency reserves are a joke, the original budgets seem to be a haphazard guess, nothing more.

    It used to be a contractor who bid too low was risking his venture and it’s future solvency if the bid was too low, now it’s just yet another excuse to beg for more money when the bidding process was shortcut mostly for political gain and project expediency.

    I guess the best a business can do these days is to join the group of “selected” govt. contractors who seem never to bring a project in on time or budget?

    Liked by 3 people

  4. What’s site C pegged at now? Almost $12b and counting? I think of what could have been done with that amount spread through the B.C. economy on infrastructure, progressive energy policy, social needs etc.
    The affect would have been long term and without a doubt, satisfactory to all interests.
    It boggles the mind how the NDP exchanged economic principle for economic film flam.

    Liked by 1 person

  5. I notice that in Muskrat falls the Public Utilities Commission was bypassed just like with Site C by the government. The NDP said they would have the BC Utilities Commision review Site C.
    Did this ever happen, and if so did we ever see the report?

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  6. So if Muskrat Falls is over budget by several billion we can expect Site C. to go to a oh, lets say $18BILLION boondoggle. Then there might be a small shake and the whole thing slides down with the water spill killing thousands,

    Like much of the hype from the B.C. Lieberal days, it was all built on shift sand. It is beyond me why the NDP/Greens decided shifting sand from the B.C. LIeberal days would work now. Shifting sand is always shifting sand, and that is about what all that shale is going to be once it starts t slide.

    Please would some in government just decide to fold and walk away from this all. The 3000 workers can go build hospitals, roads, schools, seniors centers, affordable and social housing. The First Nations and farmers can go back to what they were doing and all will be much better in this province.

    The amount of money being spent is terrible, but my concern is, if that dam bursts, how many lives will be lost. What this means is the politicians of all three parties don’t care about the humans involved. It also means all three parties have written off the lives of the farmers and First Nations who will be negatively impacted. Having seen old black and white film regarding the impact of earlier dams on humans, and read a report which made me wonder how the government could be so cruel. Wonder what they will say, when it all comes tumbling down. IF that dam ever collapses and people are killed, I’m of the opinion all those B.C. Lieberals, NDP, and Greens be charged with manslaughter as a min, murder would be better, because that is what it would be.

    You don’t build dams on shift sand.

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  7. IMO-Has BCHydro lost the moral authority to give the public power demand estimates?The BCUC should be in charge of that.Real demand has been flat for 14 years and BCHydro seems to keep sending out the same press release.Why?

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