What the Members Opposite Don’t Understand

Excerpt from Hansard: Address by Premier Kathy
Dunderdale, Private Members Motion in support of sanctioning the Muskrat Falls
Hydro Project.  House of Assembly,
Wednesday, December 5, 2012.

“…Mr. Speaker, I am not placing the fortunes of the people
of Newfoundland and Labrador in to some foreign entity over which we have no
control. Nalcor is owned by the people of Newfoundland and Labrador, Mr.
Speaker. They work for us, Mr. Speaker. Nalcor works for us, and let me tell
you, Mr. Speaker, that Nalcor is a regulated company and they have a regulated
rate of return set by the PUB. Everything they earn beyond that regulated rate
of return either gets reinvested on behalf of the people or returned to the
government of the people. You see, Mr. Speaker, this is some of the challenge,
because even the basics of how energy is managed here in this Province is not
well understood by the people opposite”.
SOME HON. MEMBERS: Hear, hear!
Note to the Premier: 1. Nalcor is not ‘regulated’ by the
Public Utilities Board (PUB). Newfoundland Hydro Corp. is the Crown owned
regulated Utility. 2. Newfoundland Hydro is not permitted to earn any return
over the “regulated rate set by the PUB”. 
Any utility charges in excess of the regulated return are ordered
returned, to the ratepayer, by the PUB. 
3. You were heard on an open line program suggesting that Newfoundland
Hydro built the Churchill Falls Hydro Project. 
Not true. The correct answer is BRINCO.
Some further comment is necessary.
Faux pas, such as those, could be overlooked as minor matters
of misspeak, but for the fact that they are a frequent occurrence by the
Premier and often, too, by her Minister of Natural Resources. 
Opposition Members seem to accept this unfortunate reality.
The media, too, are inclined to let the public make their own judgement.
Problem is, basic errors, such as those noted above, suggest that the Premier
simply does not know her file despite having been the energy Minister and one
of the leading spokespersons on Muskrat Falls.  
 This item is not about
the cut and thrust of politics when Members of Opposition parties exchange
barbs and insults across the floor of the House of Assembly.  This subject addresses the question of
whether leading politicians are up to their jobs.  
One cannot be allowed to forget the Government’s early and
deliberate strategy of obfuscation.  It
had a very specific purpose: fend off the critics.  It confirmed this hypothesis: the Premier and
her leading Ministers don’t really understand the intricacies of Muskrat, they
know that and they have to keep it a secret.
The strategy grew legs as Muskrat’s questionable entrails were
exposed and as its rationale changed. 
When one justification stretched credibility too far, another was
inserted, and kept active as long as it had staying power with the public. It began
with the proposal that power could be exported profitably.  When that blew up, it was replaced with the prospect
of power for new mines; later the mantra was economic diversification.  
The essence of today’s media, the ten or twenty second sound
bite, erodes any necessity for depth of knowledge or even the most basic
analysis.  The Premier and her two
Ministers used the limitation with great success. 
Their favourite and well-rehearsed scripts include a plethora
of innocuous lines scripted by PR types: “we need the power”; “Nalcor says
Muskrat is the lowest cost option” or “the ratepayer will enjoy stable
electricity rates for fifty years”. The politicians knew (or ought to have
known) that Demand and the price of oil, and a plethora of other “known
unknowns”, to quote a former U.S. Defence Secretary, were well beyond anyone’s
ability to calculate. 
And, what happened when they were confronted with any question
of complexity and demand for more detail? They deferred to Nalcor….Nalcor are
the experts, Dunderdale said.  The
leadership is off the hook!
Politicians ought to understand the very matters to which they
are obligating Government and the taxpayers. 
When did it become acceptable for the political leadership to
defer to senior bureaucrats for any purpose other than occasional technical
The very notion that the CEO of Nalcor could be sent to the
airwaves, week after week for over a year, to conduct the Government’s
communications campaign and to deal with what the Premier and her Ministers are
unable to comprehend, has no precedent in the annals of the political history
of this Province, whether the Tory or the Liberal version.     
To the same point, that the media fundamentally failed to
challenge the political leadership, and to have them justify Muskrat Falls,
without deference to Ed Martin and Nalcor is, I believe, the single greatest
media failure of the entire Muskrat Falls ‘debate’, not that you can grace any
phase of Muskrat’s unveiling with that interactive and engaging term.
That said, the most basic failings of two key agreements, the
Federal Loan Guarantee and the Emera Sanction Agreement, are as unknown to the
people of the Province today, as when they were first announced. Why would our
politicians care if they know they will never have to explain?
Perhaps that is why the Minister of Finance feels completely
fearless that he can go on the public media and be glib about returns on
Muskrat Falls.  He knows that neither the
media nor anyone else has access to independent numbers that might prove that
he is ‘full of it’. 
The media are easy targets. 
It is unfair to lay on them the shortcomings of a preoccupied or disinterested
public or, for that matter, the failings of politicians.  But, on major issues whose impacts are
significant, the political leadership must be held to account. They must, as a
bare minimum, be challenged and be required to show proof that they understand
their files and that they are not mere puppets of smarter, more knowledgeable
and controlling bureaucrats whose interests may vary with the public
The comments of the Premier, recorded by Hansard, and noted in
the introduction, are not misspeak, or ‘slip of the tongue’.  They reflect a Premier, who knows little of
the facts underlying the complex issues for which her Administration is
responsible; they represent a mindset that feels empowered enough to say
whatever comes to mind, even if it is totally inaccurate and off-the-wall.  The Premier knows she will not likely be
challenged by anyone, that she is free to pillory offending critics.
Hansard awaits enrichment by the Province’s First Minister and
her key Ministers.  Many of us have no
such expectation.

Des Sullivan
Des Sullivan
St. John's, Newfoundland and Labrador, Canada Uncle Gnarley is hosted by Des Sullivan, of St. John's. He is a businessman engaged over three decades in real estate management and development companies and in retail. He is currently a Director of Dorset Investments Limited and Donovan Holdings Limited. During his early career he served as Executive Assistant to Premier's Frank D. Moores (1975-1979) and Brian Peckford (1979-1985). He also served as a Part-Time Board Member on the Canada-Newfoundland Labrador Offshore Petroleum Board (C-NLOPB). Uncle Gnarley appears on the masthead representing serious and unambiguous positions on NL politics and public policy. Uncle Gnarley is a fiscal conservative possessing distinctly liberal values and a non-partisan persusasion. Those values and opinions underlie this writer's views on NL's politics, economy and society. Uncle Gnarley publishes Monday mornings and more often when events warrant.


If a Big Mac costs McDonalds $10 to produce and it is sold for $1.50, McDonalds will go out of business. They would not declare a profit!


Bill left public life shortly after the signing of the Atlantic Accord and became a member of the Court of Appeal until his retirement in 2003. During his time on the court he was involved in a number of successful appeals which overturned wrongful convictions, for which he was recognized by Innocence Canada. Bill had a special place in his heart for the underdog.

Churchill Falls Explainer (Coles Notes version)

If CFLCo is required to maximize its profit, then CFLCo should sell its electricity to the highest bidder(s) on the most advantageous terms available.


  1. You say the single greatest media failure of the entire Muskrat Falls 'debate' is not holding the political leadership accountable, that they could say anything and not be challenged. So true, and it continues. I watch Debbie Cooper, of CBC daily talk about the proposed rate increase of 7.2 percent. The application, Section 5 page 5-1 says 6.0 percent in customer rates, (which averages residential and commercial). For residential customers, the average 'increase' will be approximately 7.2 percent. So Debbie seems correct, except it reads "the average increase", not the "rate increase". Page 5-16 reads DOMESTIC: The Company proposes to increase the Rate1.1 energy charge by 7.9 percent. This increase is is approximately 0.7 percent higher than the average increase for the Domestic Class'.
    So what is the difference? It's this: the power bill we get has 3 components: basic charge for your meter, which is just over 15 dollars; the energy charge, now at 11.17 cents per kwh, and the HST at 4 percent for heating. They have left the meter charge unchanged. They propose to hike the energy 'rate' by 7.9 percent, but because the meter component is unchanged , the average increase comes to 7.2 percent, even though the 'rate' is actually 7.9 percent.
    But consider the difference. Current cost of 11.17 becomes 12.05 cents at 7.9 percent rate increase. So forgetting the meter charge, which is unchanged, the RATE INCREASE IS 7.9 percent.
    The average electric heat customer uses 1563 kwh per month on average, so 18756 kwh per year. At present this costs $2095.04 for energy. If the increase was 7.2 percent it would be $2245.88, a increase of $150.84. At the actual rate increase proposed of 7.9 percent it would be $2260.54, a increase of $165.50, an extra $14.66 per household. With about 170,000 electric heated houses, this is an EXTRA 2.49 MILLION dollars than the figure 7.2 percent suggest. Is that trivial? Is 7.2 therefore misleading? Now add the 100,000 residential non electric , and that little 0.7 percent adds probably another million to their revenue. And this is just one example of the way of presenting figures by the power companies. Doesn't 7.2 percent increase sound better than 7.9? So devise a way to say 7.9 is 7.2 and the public will get less aroused, and who would think it could add almost 4 million? Will Johnson alert us? And meanwhile many commercial customers will see a decrease in rates, some as much as 6 percent, while some have increases. And big commercial users get as much as 28 percent discounts if they use a lot of energy! Please correct me if I'm wrong. Wouldn't want Debbie misinforming the public . Winston Adams