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Wednesday, November 07, 2007

Too Much Heat and Not Enough Light on the Royalty Collection Issues

So now we see the over heated rhetoric and misinformation campaigning move from the energy industry and into the Alberta Legislature. This is a sad “state of affairs.”

The Alberta Liberals are torquing the facts by insinuating criminal intent on the Klein government Ministers of Energy and the current Minister of Energy and is reported to be “suggesting” a criminal investigation may be needed….” Mr. Taft, the Leader of the Alberta Liberals is apparently making these unfounded accusations and he knows better. After all he has a B.A. in political science, a Masters degree in community development and a PhD in business. So this hyping of the facts by such an educated and experienced individual is neither ignorance nor innocence. It is more like the kind of negative, half-truth, Republican-esque partisan politics we have come to expect from Stephen Harper.

The Auditor General Fred Dunn has clearly stated the situation around past royalty collection decisions by the Klein government. This kind of decision is at the discretion of the government and taken by the appropriate Minister, the Energy Minister in this case.

Premier Stelmach also seems to be getting caught up in the torque the facts for effect and rhetoric. He is reported to be tying an “Our Fair Share” recommendation for a proposed Oil Sands Severance Tax as being akin to the NEP and saying such a tax would “cripple the province’s economy.” That is mostly a political judgement. Ironically if Stelmach had kept that severance tax recommendation he would not have to try and renegotiate the Suncor/Syncrude royalty agreements. That tax would have leveled the playing field for the newer projects. That is partly why the Expert Panel recommended the tax.

Political judgment aside, Premier Stelmach goes much further by implying such a "production tax" would drive people out of the province, create a situation where people could not pay their mortgages and many business would go broke…as he suggests happened with the NEP.

The NEP is part of the Alberta mythosphere and we tend to forget that the NEP was negotiated with Alberta. The fact is conveniently forgotten that before the NEP got implemented President Reagan released the US strategic oil supplies. That alone pulled the rug out of the world oil prices and as they plunged they sent the Alberta economy into a tail spin. The NEP would have really hurt Alberta but it didn't, President Reagan got to us first.

The issue of uncollected energy royalties is very clear in the Auditor Generals Report. The administration recommended an increase and that recommendation was rejected by the Minister(s) of the day. That decision was totally within the government discretion so no legal wrong doing is at issue. To project a criminal intent is over the line.

What is at issue here is the quality and consequences of the policy judgment call to not increase royalties and how and why it was made at that time. We elect politicians to make these “hard choices” on our behalf and the issues are never simple and all the facts are never fully known. It is always a judgment call.

So it comes down to a few salient points. Did the Ministers of the day follow a proper review process and analysis of the situation in coming to this discretionary judgment? On what basis did they make the decision and was it a sound judgment and how do they justify the decision as being in the public interest.

The other key question is who did the Klein government listen to in arriving at such decision? Interestingly, Premier Stelmach is quoted now as saying "But at the end of the day, in this government the decisions are made by government, not listening to advice that may come from bureaucracies." "We take advice obviously, from others."

Well I hope the new Lobbyist Act will help us answer the question of just who those "others" are who our elected representatives listen to in the future and why they were so persuasive. We Albertans can then perhaps begin to understand just what part of the public interest those "others" represent. We can also consider if our elected representatives are serving the common good in the exercise of the many discretions they have and the complex decisions they have to make.

Lets remind the politicians of Premier Stelmach's early suggestion to calm down. Lets also get serious about this stuff. There is enough grist for any political mill in these royalty issues that hype and rhetoric are not only unnecessary - it is unhelpful in assisting Albertans in better understanding what is and was going on.

None of this needs to be torqued for effect. The politically motivated manufacturing of misleading media headlines are not helpful. Lets get opportunistic partisan politics out of the royalty deliberations and go right to the debate about how we ensure open, transparent, accountable and good government as the larger goal.

There are signs of hope this could happen. The multi-party support of the NDP motion for an emergency debate on these issues was a step in the right direction…we need more politicians with that greater sense of responsibility and public duty who will stand up like that. Good for those individual MLAs from all parties who voted for the emergency debate. I am looking forward to reading Hansard to see who the real statesmen are on this issue.