NAKED TRUTHS

Plant fast became serious liability for government

Manning MacDonald recalls how the Sydney steel plant fast became a serious liability. A2

In my last column I started to discuss Sydney Steel and the problems the industry was facing as the government tried to sell the plant to private interests.

The situation at the plant was in need of some drastic measures to keep it operating as it was fast becoming a serious liability for the government.

The opposition parties in the legislature and the press were continuing their attack on all things concerning Sysco.

The efforts to sell Sydney Steel had to be stepped up, as well as the need for an internal shakeup in plant management.

As I stated before these senior managers did not have the confidence of the Sysco workforce or the many other players dealing with the plant including its customers.

It is interesting to note that none of the people I mentioned before were from Cape Breton.

In my discussions with steelworkers and other local stakeholders, it became evident that if the plant had any chance to survive and operate in the short-term, this group of senior managers had to go and go quickly.

As minister responsible for the plant, with the sound advice of my deputy minister who was from Cape Breton, I relieved all of them from their positions on my first official visit to the general office.

The Chinese official from Min Metals, the president and three vice-presidents were all gone with the stroke of a pen. They were replaced by a local longtime senior executive named Jim Rudderham, a competent straight shooter who did have the confidence of the Sysco community and government.

The next thing on my Sysco agenda was to keep my promise to meet with plant unions and supervisors on a regular basis to seek their input and advice as we moved forward to secure new markets and to re-engage with our old customers.

While we were trying to improve sales, the No. 1 objective was still the sale of the plant. The people of Nova Scotia had enough of a government-owned steel plant and so did the government of the day.

The sale of Sydney Steel took on a greater urgency and occupied a great deal of my time right up to and including my years in the Russell MacLellan government.

During that time we negotiated with the Russians, Mexican interests, as well as a number of companies from Europe. We also had intensive discussions with a group who called themselves Global Steel. They even offered to buy the plant for $30 million until I asked them for the money.

While we were anxious to sell the plant we also had a responsibility to ensure that the interests of the plant workers and the community were protected and, of course, Nova Scotia taxpayers.

None of the groups we had dealt with until the election was called in 1998 gave my advisors or me much hope for a successful sale. So the search for a buyer would have to wait until after the election.

I had supported MacLellan for leader and premier after Dr. John Savage had departed. I was one of only three cabinet ministers who supported MacLellan as I felt he was the only hope of staying in power. He was new to Nova Scotia politics, having served Cape Breton for many years as a member of parliament.

He had not been part of everything Nova Scotians disliked about our government. His main opponent for the premier’s job was a former finance minister who was widely seen as the architect along with other senior cabinet ministers of all the things Nova Scotians hated about the Savage government.

I remember expressing my opinion at the time that if MacLellan did not win the leadership we were in danger of losing every seat in the province. As it turned out he won the leadership and became premier. He then took us into the 1998 election and we survived, barely. The final count: 19 Liberals, 19 NDP and 14 Tories.

Despite the Liberal brand taking a hit we were still in charge and, yes, the problem of Sydney Steel was still on my plate, and now a major problem for our new premier who had to face the legislature with a minority government.

Sysco was not our only problem but it was one we had to deal with immediately. We also knew that we would not be able to survive a budget vote and we would be forced to go back to the polls as soon as the opposition decided to pull the plug on us. That happened in 1999.

What happened leading up to and after the 1999 election and the resolution of the Sydney Steel question deserves further comment. Stay tuned.

Manning MacDonald was a former mayor of Sydney and an MLA and cabinet minister in the liberal governments of Dr. John Savage and Russell MacLellan. He lives in Sydney.