So what are we to make of the latest war of words between Premier Brad Wall and Potash Corp. of Saskatchewan? Is PotashCorp CEO Bill Doyle seriously saying that dividends to shareholders are more important than the jobs of more than 1,000 workers, including 440 in Saskatchewan?
Is the premier seriously suggesting that companies, especially Saskatchewan headquartered ones, don’t have the right to manage their business as they see fit? Clearly, Wall is casting himself as the knight in shining armour coming to the rescue of the hundreds of Saskatchewan potash miners given layoff notices this week.
First, Wall expressed concern for the workers facing layoffs just weeks before Christmas, adding that “obviously this is not good news for those employees and their families.” Then he allayed fears of major damage to the Saskatchewan economy or the provincial treasury, noting that potash revenues account for just 3.5 per cent of total government revenues.
For his part, Doyle said that he was equally concerned about the workers, promising to do “everything we can to make sure that these people are well taken care of.” But Doyle also said that PotashCorp’s dividend was “sacrosanct” and won’t be touched.
Seeing this, Wall fired off a letter to PotashCorp chair Dallas Howe, saying that Doyle’s statement “can only mean that the interests of shareholders were protected, while the interests of employees here in Saskatchewan and elsewhere were sacrificed.” Howe replied, diplomatically, that the number of employees laid off “is not connected in any way to the amount of the company’s dividend” and that even if the dividend was reduced to zero, the company would still have to “rightsize” it operations to ensure longterm sustainability of the company and the jobs of the 80 per cent of employees not facing layoffs.
So who’s zooming who here? My opinion is that Wall wants to score some political points and burnish his reputation as a populist “man of the people” battling corporate greed and self-interest. Certainly, Doyle’s comments were ham-handed and politically incorrect. To suggest that dividends are sacrosanct, but people’s livelihoods aren’t, was ill-advised, to say the least.
But, leaving aside Doyle’s impolitic words for the moment, what the CEO of the western world’s largest potash producer is
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