The Capital Chronicles

with Mia Rabson

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• A loonie for your thoughts?

  02/9/2012 3:44 PM

  

  Manitoba NDP MP Pat Martin is going after the penny again.

  The Winnipeg Centre reintroduced his bill today to take the one-cent piece out of circulation.

  "There are over 30 billion pennies in circulation in Canada today, many of which are underneath my bed in an old cookie jar," he said in the House of Commons.

  He went on to say if any evidence was needed as proof the penny’s jig is up, "it is the freebie jar at every cash register that says ‘Take one or leave one.’ We do not see jars full of loonies there."

  Martin has been on an anti-penny crusade for years. He’s not alone. The Senate, the Royal Canadian Mint, the Department of Finance, and numerous economists have studied the issue and most came to the conclusion the penny has outlived its usefulness.

  In December 2010, the Senate Finance Committee issued a report calling on the government to get rid of the penny. After a series of hearings with everyone from Finance bureaucrats to bankers, retailers, charities and consumers, the committee concluded the penny has got to go.

  Basically the Senate said, a penny can’t buy your thoughts, nor can it buy anything else on its own. You can’t even legally use more than 25 of them at one time to buy something apparently. (Who knew?)

  Retailers hate pennies. Charities, which some feared would balk because they’d lose a way to raise money, were among the chief proponents of getting rid of it. Why? Because it costs a lot of money to count and roll pennies and if people don’t have pennies to drop in a UNICEF box or a Salvation Army Christmas kettle, they will probably drop in nickels or dimes, or gosh, even loonies.

  It also costs the Royal Canadian Mint 1.5 cents to make each and every penny. Finance Canada then buys each penny from the Mint for 1.5 cents. But it can only sell them for one cent each so Finance Canada loses money for every penny.

  Consumers might be afraid they’d start to pay more without a penny because retailers would round up the prices to the nearest five cents. That might be true. However New Zealand found prices actually went down when it got rid of both its one and two cent coins. New Zealand attributed that to competition in the retail sector.

  The downside is it will actually cost money to get rid of the penny in the short term. It will be necessary to launch a pretty major communications plan to let Canadians know the penny is going to be eliminated and information on how to redeem your pennies. Plus while the pennies which come back will be melted down, it will cost the Bank of Canada money to pay people for their pennies, but the Bank will not make back that money when it melts the pennies down. But over time, the Department of Finance will save money because it won’t be paying more to make coins than they are worth.

  Both Conservative and Liberal senators on the committee backed the penny’s demise.

  The Senate committee had some pretty good recommendations for how to go about it. It suggested production of the penny be stopped as soon as possible and then removed from circulation 12 months later. The federal government, cooperating with the provinces and the retail industry, would need to make clear but voluntary guidelines for how businesses should round prices after tax to the nearest five-cent mark. These would apply only to cash transactions. The Bank of Canada would continue to redeem the penny indefinitely so if you find a jar of pennies under grandma’s bed in 10 years you can still likely redeem them. And charities can help bring in those pennies by launching penny fundraising drives.

  The Senate report has pretty much been gathering dust ever since. So today Martin is trying to get the issue on the agenda again.

  "This budget should be the penny’s last hurrah."

  In the 2010 budget, Finance Minister Jim Flaherty pledged to save money on making money by switching from paper to plastic bank notes. The first of those (the $100 bill) was released last year and the rest will be released over the next year and a half or so. Maybe this budget will be the one which puts the penny on the chopping block.

   

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• Tobacco and bubble gum don’t mix

  01/31/2012 5:04 PM

  A few years ago, now former Manitoba NDP Judy Wasylycia-Leis introduced a private members bill to go after flavoured mini-cigars. These products were often wrapped in bright colours, flavoured to make the cigars taste like bubble gum, fruit or chocolate, and were pretty popular with teenagers.

  The government picked up on Wasylycia-Leis’s bill during the 2008 election and Health Minister Leona Aglukkaq passed legislation banning flavoured mini-cigars in 2009. The ban also prevented mini-cigars from being packaged in groups of anything smaller than 20. (Critics complained the mini-cigars were often sold individually or in groups of three or four at a time, which made them more affordable for kids to buy). The law took effect in June 2010.

  Today the government showed the ban has some teeth as Health Canada seized more than 25 million of the mini cigars at three warehouses in Montreal belonging to Casa Cubana, Groupe Tabac Scandinave, and Distribution GVA Inc.

  It was the first time the government has seized the products since the bill came into force and came after two warning letters were issued.

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• Growing support in 'Toba town

  01/17/2012 12:49 PM

  Paul Dewar may not be from Manitoba but his list of endorsements from Manitoba’s NDP keeps growing.

  Today Justice Minister Andrew Swan added his name to those who back Dewar for the NDP leadership. So did MPs Matt Wiebe and Deanne Crothers.

  Already in Dewar’s corner were cabinet ministers Dave Chomiak (minister of innovation and mines), Jennifer Howard (minister of family services), Theresa Oswald (health minister), Kerri Irvin-Ross (minister of housing), Nancy Allan (minister of education), Kevin Chief (minister of children), Stan Struthers (minister of finance) and Erin Selby (minister of advanced education). MLAs Greg Dewar and Dave Gaudreau are also in the Dewar camp.

  It’s not all that surprising. Dewar’s family has deep roots in the Manitoba NDP, and while some in the Manitoba arm of the party might not have known Dewar himself all that well, they are certainly well versed in the politics of his brother, Bob Dewar and of course Michael Balagus.

  They are helping run Paul Dewar’s campaign.

  Together Bob Dewar and Balagaus are largely responsible for giving the NDP all four of their majority governments. Bob Dewar ran Gary Doer’s campaigns in 1999 and 2003 and Balagus ran the NDP campaigns in 2007 and 2011. Bob Dewar is now a senior executive with the Manitoba Government and General Employees Union. Balagus, until yesterday, was Premier Greg Selinger’s chief of staff. He just resigned.

  Niki Ashton, the sole Manitoban in the race, has a decent list of Manitoba endorsements; but if cabinet ministers hold more cache, her list is not on par with Dewar's. She has four cabinet ministers including her father, Transportation Minister Steve Ashton, Deputy Premier and Aboriginal Affairs Minister Eric Robinson, Culture Minister Flor Marcelino and Trade Minister Peter Bjornson. She also has MLAs Bidhu Jha, Drew Caldwell, Tom Nevakshonoff, Frank Witehead, Clarence Petterson and Ted Marcelino, and Winnipeg city councilor Ross Eadie.

  The biggest question from all this might be just what impact endorsements can have on the outcome of a campaign. Do rank-and-file members really fall into line behind their favourite politicians? Does Dewar’s growing list of endorsements in Manitoba mean he has a healthy shot at securing the votes from the 10,000 or so Manitoba members of the NDP? Do any candidates other than Dewar or Ashton have a chance with Manitoba voters?

  Yes and no. Certainly some members will see that the provincial politicians they respect and admire are in Dewar’s camp and at the very least it will ensure they take a serious look at what he has to offer. But this is a one-member one-vote election, and members have access to information about the candidates and their campaigns like they never have before. The last time the NDP picked a leader, in 2003, neither Facebook nor Twitter had even hit the Internet yet.

  Even websites were barely used by politicians to spread their words of wisdom.

  Now the Internet dominates the way candidates communicate. Rank and file members can watch live debates not happening in their own city, they can get up to the minute updates about policy ideas and platforms, compare and contrast them and even communicate directly with them via Twitter or Facebook or email.

  It gives individuals a much better way to hear directly from candidates all through the campaign rather than relying on the advice from the higher ups who have endorsed someone.

  That’s not to say that endorsements don’t matter.

  They just matter less.

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