Can something be worthy and inappropriate at the same time?
That is the question being asked all over Winnipeg this morning after it was confirmed the Big Four provincial Crown corporations -- Manitoba Hydro, Manitoba Public Insurance, Manitoba Lotteries and Manitoba Liquor -- would donate $1 million each to the Canadian Museum for Human Rights.
The museum is a worthy and popular project. However, the Asper family is still $17 million short of its $105-million fundraising goal and there is a deadline fast approaching. In this context, the Crowns are stepping in at a critical time to aid a project that will produce incalculable benefits.
And yet -- to use vernacular favored by the premier -- something about the donations just doesn't smell right.
In the case of Manitoba Liquor and Manitoba Lotteries, the money might just as well have come directly from government. Both Crowns turn over all of their profits to general revenues. So, while the Crowns write the cheques, they are drawing on money that would have gone to government at year's end.
The other two Crowns -- Hydro and MPI -- are another story. The former only contributes to general revenues through a tax on the water that flows through its generating stations and the latter does not make any direct transfer to general revenues. Given that neither Crown is typically called upon to support projects outside of their core mandates, the rationale for their donations is a bit harder to justify.
Even though all four Crowns claimed to have approved the donations without an edict by their political masters, this is little more than a slightly larger donation by the government of Manitoba. That presents a certain political risk for Premier Gary Doer if the public objects to his use of Crown corporations as the conduit for that support. In the case of MPI and Hydro -- both of which feature ratepayers who seem to believe charity begins at home -- there is considerable risk to be negotiated.
In 2000, Manitoba Public Insurance was vilified after it tried to give post-secondary schools $20 million of surplus funds. Although a worthy goal, the public objected and forced MPI to convert its support for higher learning into rebate cheques.
There is no doubt the NDP government is afraid about a repeat of that self-inflicted wound. Spin-doctors at all four Crown corporations worked overtime to trumpet the benefits of the museum, while assuring citizens there would be no increase in the cost of booze, electricity, lottery tickets or automobile insurance as a result.
Doer certainly did his part by uttering the words "Pan Am Games" about a dozen times when talking to reporters. He did this to remind everyone that using Crown corporations to support pet projects has been going on for a very long time. In the case of the 1999 Pan American Games, the previous Tory administration freed up Crown corporations to contribute millions of dollars in sponsorship money.
Still, if it's such a worthy goal, why not use the front door to provide that additional support?
Accounting rules may hold some answers. The province's consolidated financial statement includes the assets and liabilities of government and all of its Crown corporations and special operating agencies. In this regard, an expenditure from one Crown corporation is added into the same column as all the other expenditures of government. Never has the phrase "there is only one taxpayer" been more appropriate.
However, for its core operating budget, the province must contend with the infamous Balanced Budget Law, the act that requires the province to be in surplus for programs it delivers directly. It may be a stretch, but perhaps it is wise to keep this $4 million surplus out of an operating budget that could be afflicted by an economic slowdown later this year.
The project is worthy, and the impact on the average citizen is likely negligible. If this logic is widely accepted, then this will go down as yet another example of the premier's deft management of a potentially volatile issue.
While the premier is famous for making sure all his tactics pass "the smell test," it will be interesting to see what scent the public picks up this time.
dan.lett@freepress.mb.ca
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