Why Kathleen Wynne’s Hydro One sell-off is a sellout – by Martin Regg Cohn (Toronto Star – May 19, 2015)

The Toronto Star has the largest circulation in Canada. The paper has an enormous impact on federal and Ontario politics as well as shaping public opinion.

The reality about the partial sale of a key government asset is that the Liberals are choosing privatization because it is not an unpopular as taxation.

Selling Hydro One is no ordinary sales job for Kathleen Wynne. For a premier who places a premium on conversations, consultations and consensus, the proposed sale is a done deal. Wynne is pushing her privatization plan through the Legislature with minimal discussion, leaving key questions unanswered.

Amid the Hydro One hyperbole and hypocrisy — the Liberals and Progressive Conservatives keep reversing stances — here’s the good, the bad, the ugly, and the reality on electricity. The Liberals are using their majority to rush the sale without providing the fine print on secret deals with the unions, or protection of the public interest.

A government-appointed panel on privatization, headed by ex-TD Bank chief executive Ed Clark, concluded last November that “Hydro One transmission should remain in public ownership as a core asset.” Last month, Clark’s panel executed a spectacular backflip, recommending the sale of 60 per cent of Hydro One because, when it came to “public ownership, we did not find the case compelling.”

Clark and Wynne insist they have learned lessons from the 1999 fire sale of Hwy. 407, when a PC government undervalued the asset, overpaid for transaction fees, and allowed the private owners to jack up tolls at will. The government promises to retain substantial control of Hydro One, keep transaction costs low, and act transparently.

Transparently? As my Star colleague Robert Benzie first reported last month, the government is quietly buying off the influential Power Workers’ Union with a sweetheart deal to win their support by giving its members shares in the new entity. The Liberals have refused to provide details on their secret undertakings to the powerful union, which has since dropped its opposition to any privatization.

Even with minority ownership of 40 per cent, the government stresses it would be the largest single shareholder of Hydro One, with other owners limited to 10 per cent stakes; key decisions will require a two-thirds vote by the board, giving the province an effective veto; and the government retains the right to fire the entire board (more of a nuclear option than actual control).

For the rest of this column, click here: http://www.thestar.com/news/queenspark/2015/05/18/why-kathleen-wynnes-hydro-one-sell-off-is-a-sellout-cohn.html

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