I have three main thoughts on Ed Stelmach's royalty position and the past couple of days:
1) "Please don't say it's a compromise," were Ed Stelmach's words after announcing the Tory position on royalties. The quarter-page ad in today's Edmonton Journal didn't convince me.
Sorry, Premier. You compromised.
Ed Stelmach's compromise with the oil companies includes increasing royalty rates by only $1.4 Billion across the sector starting in January 1, 2009 and not reaching this amount until 2010. This gives oil companies over a year to reap the rewards of current royalty system, which was created when oil was $11 a barrel. This compromise includes only moderate increases in royalties for companies such as EnCana, who have posted the largest annual profits in Canadian history. I have no problem with these companies making a profit, but these natural resources do not belong to the oil companies, they belong to Albertans.
Stelmach's $1.4 billion will be $500,000,000 less than the amount recommended by the "Our Fair Share" report - which again was seen as a moderate and tame report to begin with (the $1.4 billion was also supported by Alberta Liberal Leader Kevin Taft) . Other reports, such as this report released by the Parkland Institute, recommended a more aggressive approach to royalty revenues.
A Premier should stand up for the interests of the citizens of his/her province. Stelmach didn't do that. Instead, he compromised with the oil companies and made it clear that he is willing to hand over the potential of Albertans natural resources to the oil companies, rather than allow Albertans to directly benefit from the resources that they own in the first place.
2) Where's the accountability? Mel Knight remains Minister of Energy even after Auditor General Fred Dunn singled out Knight and the Department of Energy for failing to collect billions of dollars in resource revenues over the past 15 years.
Here is what Dunn said of Knight's Department of Energy:
"The principals of transparency and accountability, I believe, were not followed. I'm not impressed."Former Auditor General Peter Valentine has been appointed to investigate, but don't expect any heads to roll in this scandal.
"The department should demonstrate its stewardship of Alberta's royalty regime and provide analysis to support that stewardship and this was not done."
"The department's monitoring and technical review findings were communicated to decision-makers. The question is: Did they hear or were they listening? At the end of the day, I don't know, but they chose not to act."
3) There is very little talk about why Stelmach decided it was a good idea to spend $145,000 of public dollars to hold a prime-time infomercial on Wednesday night which only offered vague platitudes and sweeping visuals of Alberta's foothills. Maybe the Public Affairs Bureau is bored?
There is much debate over this issue, here are some opinions and responses floating around the blogosphere:
- The 5 R's - Calgary Grit
- A Half Billion Short - Le Revue Gauche
- Royalty Check - Andrew Coyne
- Stelmach's Choice - The EcoLibertarian
- Premier Stelmach Brought Progressive Conservative Politics Back to Alberta Tonight - Ken Chapman
- Alright, everybody exhale now - albertatory
- National "Eddie" Program - The Black Kettle
Posts
15 comments:
Daveberta's upset!
"increasing royalty rates by only $1.4 Billion"
by ONLY 1.4 Billion hey? Yeah that's not very much money at all. Hah!
You Liberals really think money grows on trees, don't ya?
Money doesn't grow on trees. This money from royalties. The oil belongs to Albertans. Albertans deserve their fair share. $1.4 billions across the industry in a year when companies like EnCana are bosting the highest profits in Canadians history is pocket change for the oil industry. Albertan's deserve their fair share, and it's alot more than $1.4 billion per year.
I'm having a tough time with this issue. I don't mind what Stelmach announced, it's reasonable to bring the changes in over a timeline, but I disagree with the amount. With billions of dollars that the oil industry is collecting, I don't think another half a billion would be unreasonable to collect.
Maybe it could repave some of these delapatated Alberta highways or leaky overcrowded schools. I don't think Stelmach has that kind of vision though.
Too bad Jim Dinning isn't Premier.
I hear Mel Knight is being flown out of the province for the week in order to keep the media off him. What a scam.
And I thought the Federal Liberals were in Ottawa.
Well I'm an Albertan too and I think the increase is way too much.
Much like the Kyoto debate, there are many valid positions on this controversial issue.
I also don't think that the increase was enough, but I suspect that too many Albertans are taking positions on both sides without actually educating themselves on the details of the issue.
This is a heated debate, but there needs to be some clarity provided and Stelmach isn't doing that.
I find it interesting that due to the Royalty Review, and all the hype around it, it appears everyone has forgotten about environmental contamination, high cancer rates in Aboriginal communities, and workers who are being shoved into terrible work camps, just so share-holders can get a "decent" profit.
Not to say that economics are not important - they clearly drive this province - but at what cost?
Too bad Ed Stelmach won't be around to celebrate 2009 as Premier.
Yeah, it's curious as to why he would give his address after the markets closed and then unveil the revised royalty scheme the next day?
perhaps he was testing the waters before to see how the markets reacted before he made final his decision.
The we're-not-Liberals-we're-Alberta-Liberal's attempt to haul Knight on the carpet for previous Department of Energy misgivings don't stand up to the test.
Mel Knight has been Minister of Energy for 10 months, hardly much time to turn around an entire department.
Moreover, as a former small oil-and-gas man, there is nobody I trust more in the Alberta Legislature than him to straighten things out at Alberta Energy.
If you want to see incompetance and mass energy sector panic, give Hugh MacDonald 5 minutes at the helm of Alberta Energy ;)
Dave, maybe you should be leader of the Liberals. You've said more about Royalties on this blog than Taft has said in a month.
Dave, maybe you should be Premier. You've said more about Royalties on this blog than Stelmach has said in a month.
Funny how the Conservatives were rabidly calling for heads to roll during the sponsorship scandal, but are the first to back down when one of theirs screw up. Knight is Minister. He is responsible. He should do the honourable thing and step down. After the PC's mismanaged and failed Albertans by not collecting BILLIONS of DOLLARS in royalties, he owes it to Albertans. But he won't, because honour won't pass throught his or Stelmach's mind.
Accountability and Transparency, my ass.
Overall I was pretty unimpressed. I don't care if Ed wants to spend $145,000 of PC Party money to do a prime-time election ad. But those were my hard earned tax dollars that he spent to basically say, "Please bear with me; I'm way in over my head and I don't know why I ran for this job, but I at least deserve some points for effort, don't I?" Pathetic.
And I'm no economist, but to me this was a lot of market disturbance and market uncertainty (for over a month!), for what appears to be a very small amount of money in the long run. It's only going to be, at most, $1.4 billion more than the govt had before. Not GROWING by $1.4 billion a year every year, but just $1.4 billion more than we would have had. Period. Health care already costs $10 billion a year, and it has about 10% inflation each year. 10% of $10 billion is $1 billion. Bingo! Most of the money's already committed. (Unless we are to expect health care cuts again.) And the other $0.4 billion? Well last year the Tories spent $0.5 billion on cost inflation for infrastructure. Not to build anything new; just to pay more money for things they were already building. Inflation hasn't gone down, it's gone up. So you can expect the same thing again.
Presto! The pittance of money already gobbled up. Certainly doesn't seem like all this nonsense and divisive debate was worth it at the end of the day.
I wish I had someone new to vote for. Someone credible. Not Wildrose. Not Alliance. Not Green. Something new. Where is this generation's Peter Lougheed?!
This has been the longest 10 months of inaction since Don Getty. I can't wait to vote for Ted Morton in the Leadership race in 2008 when we finally rid our party of this Stelmach schmuck.
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