Premier pleased feds to pay $130M

James McLeod
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Taxpayers' coalition slams government for Abitibi settlement

Premier Danny Williams said Wednesday he is pleased with a settlement between AbitibiBowater and the federal government to end the legal battle over the mill in Grand Falls-Windsor.

Premier Danny Williams met with the media at the Confederation Building in St. John's Wednesday morning reacting to Tuesday night's announcement the AbitibiBowater has settled with the federal government for $130 million.

The federal government agreed to pay $130 million to Abitibi for the mill and the hydroelectric assets which the province seized in the winter of 2008.

“I think it’s a fair compensation,” Williams told reporters.

“These are mature parties here — the Government of Canada and a major corporation — that have agreed upon a price.”

Despite the fact that the province seized the assets, it was Ottawa that was facing a NAFTA challenge by Abitibi, and federal lawyers decided a long, drawn-out legal battle would be more expensive than settling.

It will be the Government of Canada who pays the settlement.

Williams said that in a cordial conversation with Prime Minister Stephen Harper Monday, he was assured the federal government would not try to recoup that money from the province.

“As far as Ottawa is concerned, the prime minister has made it very clear that the Government of Canada is taking this liability,” Williams said.

“If you’ve got a couple of days, I can tell you all the reasons why Newfoundland and Labrador is not being treated unfairly here.

“We make a huge contribution to Canada, I’ve said it time and time again, through our natural resources and through everything we do.”

Some commentators on the mainland weren’t buying Williams’ positivity.

“I think that Danny Williams treats federal taxpayer money like his racecar: fast and loose,” said Kevin Gaudet, federal director fo the Canadian Taxpayers Federation. “I get that the premier wants to look like the white knight, that’s kind of how he rolls, and he’s never better at it than when he’s using other people’s cash.”

“As far as Ottawa is concerned, the prime minister has made it very clear that the Government of Canada is taking this liability,” Premier Danny Williams

Gaudet said that the $130-million price tag is proof that expropriating Abitibi’s assets was the wrong choice.

After Williams made that decision, Gaudet said it was only a matter of time before taxpayers would have to pay up.

Opposition House Leader Kelvin Parsons said he’s glad the saga is over.

“We have to be very thankful, of course, to the federal government, because they just got us off the hook for $130 million,” he said. “I guess the question now is politically whether there will be any ramifications.”

On Wednesday, Williams acknowledged that things are far from finished with Abitibi.

Abitibi had minority partners in some of its hydroelectric dams, and those partners need to be compensated for the expropriation.

There is also an ongoing legal battle over who will pay for the environmental cleanup of contaminated sites across the province, including the mill property in Grand Falls-Windsor.

The provincial government is currently appealing that case to the Supreme Court of Canada, but Williams admitted Wednesday that is a bit of a long shot.

Ultimately, though, he said that he didn’t regret the decision to expropriate Abitibi’s assets.

Organizations: Supreme Court of Canada

Geographic location: Abitibi, Canada, Ottawa Newfoundland and Labrador Grand Falls-Windsor.The

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Recent comments

  • steve
    August 26, 2010 - 15:52

    Well, "Pat" of course it was the government of Canada that signed NAFTA. Provinces don't sign international trade agreements. Danny, and his ABC = "Anything But Canada" mentality may be popular back home, but we're getting a little tired of supporting his fiefdom and paying for his stunts. Oh ... I'm sorry ... he say's you send "natural resources" to the rest of Canada. What might they be? Couldn't be fish ... they're all gone. Just so I have this clear ... Newfoundland seizes the assets of a struggling company and Canada settles the matter financially to avoid serious trade problems with the country that company is from - - Danny wants Canada to clean up the mess left behind and you're the injured party?

  • Gary N
    August 26, 2010 - 14:06

    Peace in our time is a quote that springs into my head. Harper has done so much with this gesture to Newfoundland. Its politically very smart: The Newfoundland government made a mistake in its legal action, Harper pays the bill for the mistake, Danny Williams stops the anti-Harper rhetoric and at least 2 seats in Newfoundland will go Conservative in the upcoming federal election. Very clever.

  • Larry Snow
    August 26, 2010 - 13:25

    It don't matter how you approach any court battle provincial or federal, the long drawn out BS will usually end up costing a person or in this case the province more in the long run than what Danny is doing by making a settlement up front. There is no doubt there will be more ramifications ie: environmental cleanup and who's going to agree or disagree with the process. I can see why Kevin Gaudet, federal director for the Canadian Taxpayers Federation will be upset, it might even cost him a dollar of his taxes. I'm sure you wouldn't hear as much from him if NL was footing the bill. Anyway with all said and done if my tax dollar has to be spent up front to save me money in the end I'm all for it. I am a Newfoundland & Labradorian but unfortunately not living there. Above all I am a PROUD Canadian. Danny continue the strong fight for NL and keep your heart and soul into it! You will never be able to please all the people all the time but as long as you know in your heart you are making the right decision, it is. God Bless.

  • Fred W
    August 26, 2010 - 11:13

    You can fool all of the people some of the time. Well, those mill workers who lost their jobs would rather be commuting to Alberta for work anyway.

  • pat
    August 26, 2010 - 10:01

    Interesting how the usual name calling is used by some to hide their inability to argue on a topic such as this one. It was the government of Canada that signed NAFTA with all of it's rules and regulations. It was Justice Dept of Canada that decided it was cheaper to just pay a settlement, they did not say they would lose or win the case. Not our call. So in the absense of any real intelligent points to make we resort to name calling as did Kevin Gaudet. Oh, just wondering there Kevin is your Association tax exempt , so I guess the answer is yes, so we the taxpayer are paying for your trips, and car rides to conduct your business of being a critic with out any real information to pass on.

  • In defence of free markets
    August 26, 2010 - 09:58

    The Williams government should be embarrassed, not pleased. The feds are just protecting larger trade issues that have the potential to hurt the country at large. Danny with a small town mentality didn’t think of that. There is no such thing as a free lunch. This will indeed come back to haunt the province in some manner.

  • S
    August 26, 2010 - 08:52

    And why should he not be pleased? He takes his fit and others pay the price!

    • flash
      August 26, 2010 - 12:47

      Sure Danny got the money sure make him pay or put him in collections.