Business taking advantage of gov’t
If Brad Wall, Michael Fougere, and their administrations had resolved to dedicate their time in office to proving that business is smarter than government, we’d have to give them credit for offering some compelling examples.
The most recent example comes from the City of Regina, whose recycling program has come under fire.
This week, CBC reported that the city didn’t know whether glass food containers were included in a major recycling contract with Emterra Environmental.
When asked whether nonrefundable glass containers that were included in the city’s list for pickup were actually recycled, CBC said a city manager first cited an alleged agreement between Emterra and SARCAN — the existence of which now seems to be very much in doubt.
Now, the city has issued a denial that Emterra was ever required to recycle broken glass food containers, while simultaneously claiming that it has done so in the past and will keep doing so in the future.
But even on the most charitable possible interpretation, the city doesn’t seem to have much idea as to the contents of its contract with Emterra — to say nothing of whether Emterra is living up to its terms. And at worst, Regina’s citizens may have been paying Emterra for a service that it never expected to provide.
If the story sounds familiar, that’s because it merely echoes what’s happening elsewhere in Saskatchewan.
Just this week, we also learned what happens when a private developer breaks a contract with our provincial government with no explanation other than its own failure to accurately estimate construction costs.
One of the main arguments for outsourcing government services is to transfer the risk of failure to a private contractor rather than the public. As the theory goes, the public gets the service it would provide anyway for a fixed price, while the contractor takes a premium over its expected costs in exchange for assuming the risk if things don’t go as planned.
Instead, faced with Deveraux Developments’ refusal to honour its contract to supply affordable housing, the Saskatchewan Party decided that it would rather leave renters in the cold than require the developer to live up to its agreement. This indeed sets a precedent for corporations doing business with Saskatchewan: businesses can brazenly repudiate any commitments whenever they prove inconvenient, knowing that Brad Wall and his government would rather curry favour with political friends than provide the services people need.
Finally, there’s the debacle over smart meters, which damaged homes in the name of low-cost, outof-province procurement, It’s been “settled” on terms that include the manufacturer Sensus taking credit for the cost of developing the power meters it was supposed to supply in the first place.
And each of these recent examples represents only the tip of the iceberg. Indeed, far too many of our province’s basic economic structures — including our resource royalty and corporate tax credit regimes — are also based on much the same theory: that we have to meekly put up with corporate abuses in order to see any business done at all, and can’t afford to develop either oversight mechanisms or public alternatives to protect ourselves.
Unfortunately, our corporateowned governments lack both the intestinal fortitude and the basic competence to hold a business partner to its word. And so we should be aware what’s happening every time Wall or Fougere rolls out the Mission Accomplished banner to announce a new project: while the money being spent on our behalf is locked in (unless a business decides not to take it), we can never count on getting what we’ve paid for.
Fingas is a Regina lawyer, blogger and freelance political commentator who has written about provincial and national issues from a progressive NDP perspective since 2005. His column appears every Thursday. You can read more from Fingas at www.gregfingas.com.