Winnipeg Free Press - PRINT EDITION

Hydro refuses to say what $223 million bought

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Do you think it's reasonable for the government to spend $223,531,822.71 and refuse to disclose how the money was spent?

Sadly, that is what has happened.

No, this isn't a conspiracy theory and the matter doesn't involve unidentified flying objects or lights in the sky. All the information has been posted on the Canadian Taxpayers Federation's website and the organization behind the expenses -- Manitoba Hydro -- doesn't deny the numbers or the secrecy.

The spending comes from Hydro's push during the past decade to build new dams in northern Manitoba. Part of that preparation involved Hydro sitting down with aboriginal communities potentially impacted by the new dams and working out some kind of flood compensation agreement before they're built.

In theory, it sounds completely reasonable.

As Hydro started to discuss new dams in the north, however, it cooked up a recipe for disaster. It told the bands they could hire lawyers and consultants for the negotiations and Hydro would pick up the tab; the bands could repay a portion of the costs later on.

Oh, and all expenses would be kept completely confidential.

Allowing any group of people to rack up loads of expenses and keep all the information hidden from the public is a well-known no-no in government.

Off reserve, we have seen countless governments and politicians over the years getting caught abusing the system because they thought they could keep certain expenses hidden from the public eye. Many similar stories have come from reserves over the years as well.

As a non-profit taxpayers watchdog, the Canadian Taxpayers Federation began investigating some of these Hydro expenses back in 2009 after a whistleblower from one northern reserve came forward with some troubling allegations.

She described band members being paid to attend public meetings in her community to discuss the dams. Those same meetings were allegedly full of door prizes such as video game systems, flat-screen TVs and freezers.

The whistleblower even produced a cheque stub for $1,225 that she received from one of the consulting companies that was doing Hydro-related work for her community. She also told the media she was paid $700 on another occasion to attend a two-hour meeting.

Hydro maintains it has never knowingly paid for door prizes or large cheques to attendees. And it may be right -- not "knowingly."

When allegations come forward that a consulting firm paid for by Hydro is out cutting cheques to band members for large sums to attend meetings, Hydro can't simply put its head in the sand and ignore the problem.

Beyond the whistleblower's allegations, Manitoba Hydro needs to explain what it noted in its 2011 annual report -- "A First Nation terminated an employee for altering invoices payable to the corporation."

Was that offence related to dam-negotiation costs? Who knows? Hydro refuses to respond to our information requests on that matter as well.

The provincial government has also been silent on the issue despite the CTF raising this matter several times during the past few years. Nothing has changed -- the government continues to allow Hydro to spend hundreds of millions on these "negotiations" while keeping all the expenses hidden from the public.

Recently, the CTF lost a challenge with the provincial Ombudsman's office to try to push Manitoba Hydro to release details about these expenses. However, we take some comfort knowing the whistleblower in question has since been elected to her community's band council. In fact, the entire brand-new council is working hard to find out what the old council did with the money.

In the meantime, this issue is also a good opportunity for both opposition parties -- the Liberals and Progressive Conservatives -- to explain what they would do differently. Would they change information laws to stop allowing such private deals to occur without any accountability to the public?

One thing is for certain, we'll be damned if we're going to let this issue go away. No government should be allowed to spend more than $223 million on lawyers and consultants without any accountability to the public.


Colin Craig is the Manitoba director of the Canadian Taxpayers Federation.

Republished from the Winnipeg Free Press print edition February 12, 2013 A11

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