Muskrat Falls de­mands a pub­lic in­quiry

The ques­tion is, whose as­sump­tions were they?

The Aurora (Labrador City) - - EDITORIAL - Pam Framp­ton

“Truth is like the sun. You can shut it out for a time, but it ain’t goin’ away.” — Elvis Pres­ley

Con­sumer ad­vo­cate Den­nis Browne is un­equiv­o­cal.

He says there must be a pub­lic in­quiry into Muskrat Falls.

In a re­cent phone in­ter­view, he ex­plained why he was among those who have ad­vised Pre­mier Dwight Ball that a foren­sic au­dit is not the best op­tion for de­ter­min­ing just how the multi-headed hy­dra of a hy­dro­elec­tric project has turned into a $12.7-bil­lion beast.

And af­ter hear­ing his ar­gu­ment, I agree.

“This is be­yond foren­sic ac­count­ing,” he said. “This re­quires a full, open process that cit­i­zens can par­tic­i­pate in. Any­thing less would be a dis­ser­vice to the peo­ple of this prov­ince. The pub­lic needs to hear what went on here. I urge a full pub­lic in­quiry presided over by a se­nior jus­tice of our Supreme Court.”

Browne is clearly in­censed about Muskrat Falls, which he feels was foisted upon a pub­lic largely un­aware of the capri­cious pre­sump­tions used to jus­tify it.

“This prov­ince has been dealt a ma­jor fi­nan­cial blow of un­par­al­leled con­se­quences by a small group of in­di­vid­u­als who seem to have usurped the con­trol of the gov­ern­ment and our fi­nances with a de­fec­tive prod­uct that they re­fused to have scru­ti­nized,” he said.

Browne con­tends the Pub­lic In­quiries Act is the only mech­a­nism we have with enough teeth.

“A com­mis­sioner has the abil­ity to sub­poena records and doc­u­ments, which a foren­sic au­di­tor doesn’t. … We don’t need foren­sic au­di­tors go­ing in and look­ing at com­put­ers. We need (a process whereby) doc­u­ments are brought for­ward and put be­fore wit­nesses. That is the only way to go here. … We’re into le­gal is­sues. … A judge could make find­ings of mis­con­duct.”

Browne says the busi­ness com­mu­nity should shoul­der some re­spon­si­bil­ity for back­ing a project that will pro­duce power at rates most peo­ple sim­ply can­not af­ford.

When then pre­mier Danny Williams an­nounced Muskrat Falls was a go on Nov. 18, 2010, busi­ness lead­ers leapt onto the band­wagon.

“We’re very ex­cited about this an­nounce­ment,” said then St. John’s Board of Trade chair­man Derek Sul­li­van. “It’s a big day for the busi­ness com­mu­nity.”

Richard Alexan­der of the New­found­land and Labrador Em­ploy­ers’ Coun­cil was all for it, as well. “It’s go­ing to cre­ate a lot of jobs in this prov­ince…,” he said.

Bradley Ge­orge of the Cana­dian Fed­er­a­tion of In­de­pen­dent Busi­ness (CFIB) — New­found­land and Labrador was also bullish.

“This is good for (power) rate sta­bi­liza­tion for small busi­ness, but more than that it’s just a great day for ... the busi­ness cli­mate,” he said at the time.

(Two months ago, the CFIB is­sued a news re­lease not­ing that pricey Muskrat Falls power is ex­pected to cost small- and medium-sized busi­nesses in the prov­ince $179 mil­lion more a year.)

Den­nis Browne is right. A foren­sic au­dit could not get to the heart of the bill of goods we were sold ver­sus what we are ac­tu­ally go­ing to pay for.

The only ques­tion is how soon an in­quiry could be called.

Nal­cor CEO Stan Mar­shall sees an in­quiry as in­evitable and the best way to get at the facts, but he thinks it’s in the best in­ter­ests of the prov­ince to wait un­til the project is done.

“My un­der­stand­ing of a foren­sic au­dit is that it won’t nec­es­sar­ily give you the answers that you want,” he said in an in­ter­view at Nal­cor’s head­quar­ters in St. John’s on Wed­nes­day.

Mar­shall says, quite sim­ply, Muskrat Falls was pred­i­cated on flawed as­sump­tions — that prices for elec­tric­ity and oil would never go down and that de­mand for elec­tric­ity would con­tinue to rise.

The ques­tion is, whose as­sump­tions were they?

“No mat­ter what the ques­tion is, Muskrat Falls was al­ways the an­swer,” Mar­shall said.

In other words, once the project was agreed upon, there was no stop­ping it and — given that it was founded on shift­ing sands — cost over­runs and de­lays were in­evitable.

“When the project is done there will be time (for an in­quiry),” he said, and added cryp­ti­cally, “I don’t think all the answers you’re look­ing for are nec­es­sar­ily in this build­ing.”

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