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Pam Frampton: Dwight Ball’s dilemma

Premier Dwight Ball.
Premier Dwight Ball.

The premier is in a real political pickle. With the call for a financial audit of the obscenely expensive Muskrat Falls hydroelectric project building to a clamour, Dwight Ball is perched precariously on the horns of a dilemma, and he’s damned if he acts now and damned if he waits.

Pam Frampton

Ironically, Ball will pay politically if he chooses the unpopular option, even though the now $12.7-billion behemoth was the Progressive Conservatives’ brainchild.

(Someone should mention this to the 48 per cent of respondents in a July poll who would’ve given the Tories their vote were an election held that day.)

In fact Ball, as leader of the Liberals, was expressing concerns about the cost of the project even before it was sanctioned.

“We still have questions here around the overruns,” he said on Aug. 1, 2012. “We’re the ones that are mostly exposed in all of this.”

And we’re a whole lot more exposed now, five years and nearly five and a half billion dollars later.

Former premiers Brian Peckford and Tom Marshall — both Tories — are in favour of an audit, and an inquiry, should the audit results warrant one.

Marshall was Natural Resources minister in 2013, when SNC-Lavalin tried unsuccessfully to present to Nalcor a risk assessment report warning of potential delays and significant cost overruns.

And though Marshall says he had confidence that then Nalcor CEO Ed Martin and his staff were managing risk, even he feels there are too many unanswered questions as to how the project went off the rails.

“There has to be a review or an audit or an inquiry done to find out what steps Nalcor have taken to mitigate those risks,” he told me last week. “People have a right to know. … They own the company and they’re entitled to the truth.”

Ball insists he’ll have an audit done as soon as possible, but says doing it now will cause further expense.

“The responsible action for me to take as premier is to ensure that the timing of the review does not add more costs to the ratepayers of this province,” he said in a statement emailed to me July 31.

“We are in a critical construction period of the project which is 75 per cent complete…

“To keep project costs under control, Nalcor needs to take full advantage of the momentum in construction and finish strong. Schedule losses and capital cost increases equate to increases in project costs and rates for consumers. There are also legal and financial ramifications that come with delaying contractors. …

“I cannot and will not make the people of the province pay one cent more than is absolutely necessary for this project. I have heard from the AG, Justice, Nalcor CEO and board, as well the Consumer Advocate, that an inquiry/audit has the potential to interrupt operations.

“I fully commit to initiating a forensic audit or inquiry at the earliest possible date that doesn’t impact ratepayers. We must not disrupt this critical construction stage which could conclude in early 2018. The people of this province deserve answers and I am committed to seeing that through.”

Brian Peckford, who says Nalcor’s rejection of SNC-Lavalin’s risk report ripped away the last vestige of confidence he had in the project, warns that waiting too long could thwart any hope of getting at the truth.

“A number of years from now will be too late — new circumstances, different political dynamics, will mitigate against the real answers being discovered,” he said last month.

In September 2013, another former premier wrote a letter to The Telegram outlining his concerns.

“A wise and prudent government would most certainly complete this season’s contracted and committed work on site preparation and then order and direct Nalcor to cease any further expenditures until a reassessment is done to determine if the current situation and current updated future predictions still suggest the project is economically viable,” Roger Grimes said.

If only someone had listened. But the Tories were too busy stroking their egos and preening themselves for the foresight of their pet project.

“It shows the vision we have,” then finance minister Jerome Kennedy said.

 

Pam Frampton is The Telegram’s associate managing editor. Email pframpton@thetelegram.com. Twitter: pam_frampton

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