Manitoba Hydro is cutting 900 jobs — 15 per cent of its workforce — and there's more to come.
The cuts will come from throughout the entire organization, including the elimination of three vice-president positions, and should save the utility $65 million a year.
But that won't be enough to save Manitobans from significant rate increases for the next five years unless the provincial government provides financial help, Hydro board chair H. Sanford Riley said Friday in a prepared statement.
"Even with these reductions, double-digit annual rate increases would be required for at least five years in order to re-establish Manitoba Hydro on a proper financial footing," he said.
"We believe that a balanced approach in which the government — the owner of Manitoba Hydro — invests equity into Manitoba Hydro, will allow the utility to moderate rate increases to more manageable levels."
Kelvin Shepherd, the Crown corporation's president and CEO said the intention was to reduce the 6,200-person workforce more slowly through attrition, but the utility couldn't wait any longer. He said Hydro wants to cut as many of the jobs as possible by the end of 2017.
There are between 900 and 1,000 employees eligible for retirement, though they may not all be in jobs Hydro wants to reduce, and they won't necessarily be willing to take a buyout. Shepherd wouldn't say what the next move would be if 900 people don't leave voluntarily.
And he declined to answer questions about the amount of financial help the board is seeking or the size of rate increases Manitobans could expect.
"Those are all discussions between the board and the government," he said.
Premier Brian Pallister has, so far, resisted making any commitment to a Hydro bailout and was not available for comment Friday.
The government released a statement from Crown Services Minister Ron Schuler, who pointed the finger at the NDP.
"Serious problems, created by political decisions and direction of 17 years of NDP government, have forced the board of directors of Manitoba Hydro to make some very difficult decisions," Schuler said.
"Addressing the financial challenges of Hydro will take time. Our government will continue to monitor the corporation's ongoing efforts. We will review and consider Manitoba Hydro's plan for the future alongside the necessary processes of the Public Utilities Board, which will play a significant role moving forward."
NDP labour critic Tom Lindsey called the decision "a shocking and shortsighted move."
"The loss of so many skilled workers puts Hydro’s long-term future in doubt by making it more difficult to finish projects on time and meet export contract deadlines, Lindsey said in a prepared statement. He said "it will force Hydro to rely more heavily on contract and out-of-province labour to fill the gaps Pallister is creating."
Hydro said in the fall that megaprojects approved by the former NDP government would doom the utility to doubling its debt to $25 billion and cause serious damage to Manitoba's credit rating.
Friday's news came as no surprise to the unions representing the bulk of Hydro's workforce.
"They certainly made lots of noises in the fall," said Unifor's Paul McKie. "First they create the false story of a financial crisis, now they kill hundreds of good jobs."
McKie, the union's Manitoba and Saskatchewan area director, said there's plenty of anger over the announcement.
"It's not good — 900 jobs is massive," he said, adding Unifor has no idea how many of its members will be affected. "To take 900 good-paying jobs out of the Manitoba economy is vicious."
International Brotherhood of Electrical Workers Local 2034 president Mike Velie said Hydro is targeting 200 to 250 IBEW-member positions but has not provided specifics.
About 280 members are currently eligible to retire, Velie said.
"They have a brand-new board hand-picked by the premier," Manitoba Federation of Labour president Kevin Rebeck said. "This is a broken promise. Manitobans put their trust in (Pallister) to protect services."
The Canadian Union of Public Employees has already lost 150 Hydro jobs in the last five years and recently agreed to a wage freeze in the first year of a four-year deal, Local 998 president Chris Mravinec said, adding further reductions of CUPE members will affect customer service.