Tuesday, September 13, 2016

My party, right or wrong, unless they are wrong for Ontario

One of the dangers with hyper-partisan political punditry is the ever present danger that one’s party will switch policies without warning. I was reminded of this recently when a Liberal apologist wrote an op-ed for a local news website  with a left-of-centre editorial slant.

The op-ed ripped into Ontario auditor-general Bonnie Lysyk’s annual report that concluded the province’s ratepayers paid $37-billion more than necessary from 2006 to 2014. Moreover, according to her report, ratepayers will ante up another $133-billion by 2032 on hydro bills due to the so-called “global adjustment,” a little understood charge that—according to the Toronto Star “soared to 7.9 cents a kilowatt hour in November 2015.” (The prior year, it had averaged less than 5 cents a kwh, the Star pointed out.)

Our pundit described Ms. Lysyk’s report as “a mischievous red herring” and questions “that she even understands Ontario’s energy system.”

Now I don’t know the auditor-general personally, but I do know she has a sterling reputation supported by a rather enviable résumé. Furthermore, I’ve not seen any criticism of her annual report or of her suitability to perform her office in any of the mainstream news services. The following is an unofficial summary of her business/government background:

Ms. Lysyk is a Chartered Professional Accountant (CPA), a Certified Internal Auditor (CIA), and has earned a Masters in Business Administration (MBA). She has over 25 years experience gained from working in audit, finance, risk management, and governance in both the public and private sectors. She served as the Deputy Auditor General & Chief Operating Officer for the Office of the Auditor General of Manitoba for nearly seven years. Furthermore, for over ten years she worked for Manitoba Hydro in various roles including Assistant to CEO, and also served as the Chief Audit Executive with the Manitoba Liquor Control Commission.

Seems to me she’s just the sort of person I’d hire for her demanding office and to oversee the value-for-money audits she performs on behalf of the Ontario Legislative Assembly.

Until this op-ed appeared a few days ago, almost everything I’d read or heard about Ontario’s electricity costs were negative, with blame placed squarely on the shoulders of the McGuinty/Wynne Liberals.

Yes, some try to blame the Harris PCs and others try to rationalize Ontario’s sky-high energy rates by comparing the average  dollars Ontarians spend on household energy bills compared to that in other provinces. Also, I’ve seen comparisons of the share of after-tax income spent by Ontarians on home energy costs to shares in other provinces. And, apparently, there are some provinces in which average bills and share of after-tax income are higher.

This is cold comfort, however, to those who have seen the price of electricity almost triple over the past decade and a half—a 15-year period over which the rate of inflation has been modest. And, frankly, it does little to ease the pain of knowing that 77 per cent of a residential hydro bill is made up of the infamous (and hidden) “global adjustments.” In short, hydro rates are beggaring those on fixed incomes.

Earlier this summer, Global News reported that according to data it obtained from the Independent Electricity System Operator (IESO)—the agency responsible for managing Ontario’s energy system—residential customers paid an average of 7.9 cents per kilowatt hour in Global Adjustment fees last year. (Note that this is the same figure reported by the Toronto Star.) And that:

…for every $100 in usage that appears on your electricity bill, $77 of that is the Global Adjustment fee. Meaning the cost of electricity use is only $23.

That’s 77 per cent of your electricity bill, folks, and that’s awfully hard for anyone to justify. Global News put it this way:

And while the argument can be made that the Global Adjustment fee simply reflects the true cost of producing reliable, green electricity in the province, this ignores the fact that, in 2015 alone, Ontario sold more than 22.6 billion kilowatt hours of electricity—enough to power 2.5 million homes—to places like New York and Michigan at the fair market price of 2.3 cents per kilowatt hour—generating a loss of more than $1.7 billion for Ontario hydro customers.

We live in an Alice in Wonderland world, don’t we?

But back to our local Liberal pundit. His apologia was not even a week old when our intrepid premier pulled the proverbial rug from under him.

All his justifications and rationalizations notwithstanding, Lt.-Gov. Elizabeth Dowdeswell delivered the Wynne government’s throne speech on Monday, and outlined its intention to reduce residential electricity bills by 8 per cent—the equivalent to removing the province’s portion of HST. And according to Finance Minister Charles Sousa, “We’ve been planning this for a number of months….” Premier Wynne couldn’t have been clearer: electricity rates/bills are too high, period.

There is nothing too wrong with “partisanship” per se,   but the my-party-right-or-wrong sort can be corrosive in a democracy. Governments need to be held to account, and this Ontario government is no exception. Yes, it bought some labour peace—at enormous expense, by the way—in the education sector and have made headway there, but in virtually every other sector it has bungled the job.

Far too often they have created expensive problems only to later rush to the rescue with costly fixes and much fanfare. I love how our energy minister takes great pride and credit for renegotiating the Samsung renewable energy agreement, which he claims will save $3.7-billion. How disingenuous when his government negotiated the original deal and gave away the farm, so to speak.

And this: half a decade ago, the Liberals ignored weeks of opposition calls to exempt electricity bills from the then proposed HST, but now are promising a tax break with about as much self-righteousness as any politician could muster.

The Queen’s Park Grits have such an appalling record that even their most ardent media supporters are taking potshots at them—Toronto Star is a case in point.

It has to be said, I wish the opposition were a more attractive option. But they are all we have and it really is time for change, just as it was last year in Ottawa when the Conservatives were voted out. Frankly, the Queens Park opposition looks no worse as an option than the federal Liberals did in 2014.

According to a recent public opinion survey by the Forum Poll, just more than one quarter of Ontario voters (28%) would vote Liberal. Now only the hard core Grits and the propagandists who some refer to in political jargon as “useful idiots” remain in complete solidarity with them. That’s repudiation.

[I owe credit for the title of this essay to Carl Christian Schurz (1829–1906) who said in 1872, “My country, right or wrong; if right, to be kept right; and if wrong, to be set right.”]


  1. Bank on Russ as usual. I just can't get excited about Patrick Brown. But, as you suggest, he is really the only alternative. Sigh!

    1. Russ, that should be "bang on" not "bank on."