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Russ Francis

ON APRIL 21, the BC government organized a “virtual townhall” on the COVID-19 virus for the Island Health region. Given the extreme financial challenges that the virus poses for the government, I couldn’t help but wonder whether the vast sums in public funds being doled out to LNG Canada—through royalty tax credits, reduced hydro rates, a provincial sales tax holiday, a carbon tax ceiling, and cancelled LNG income tax—might be in jeopardy.

Or might the handouts even be switched to support renewable energy?

Sadly, the esteemed panel was unable to get to my question: “Given the likelihood that the climate crisis will kill even more people than the virus, should the $6-billion taxpayer handout to LNG Canada be diverted to renewable energy projects?”

Fortunately, eight days later, the government’s PR wing did answer my question. Well, sort of. The following is the verbatim emailed response I got from the Citizen Engagement Team. You be the judge.

  • There is no handout.
  • The provincial government developed a framework to ensure natural gas development had a level playing field with other industries in B.C., allowing investment to move forward so jobs could be created.
  • This framework aligns with our climate commitments, as described in CleanBC. That plan has put us on a path to a cleaner, better future where we can continue to balance environmental protection with economic competitiveness and job creation.
  • The LNG Canada project fits into the climate goals of CleanBC and allows B.C. to build a strong economy—that is even more important today as we grapple with the economic challenges created by the COID-19 [sic] pandemic.
  • More details about the natural gas framework and the opportunity created as a result of LNG Canada’s investment can be found here.

Thanks, Citizen Engagement Team. That clears up everything!

Russ Francis worked as a political columnist and reporter for many years before becoming a BC government analyst. During his 10 years with the government, he worked in strategic policy, legislation and performance management for a number of ministries. He’s happy to be writing again from his home in the Southern Gulf islands.

Russ Francis

NOT EVEN THE CURRENT VIRUS PANDEMIC can sway the fossil fuel multinationals from their chosen path.

On February 10, 2020—just four days after Provincial Health Officer Dr. Bonnie Henry announced the BC’s fourth COVID-19 case—Peter Zebedee took action. The chief executive officer of the LNG Canada joint venture registered to lobby the BC government, according to the BC Office of the Registrar of Lobbyists.

To help out, seven other LNG Canada staff also signed up to lobby the premier, the BC Oil and Gas Commission, and numerous ministries.

The topics? For one, LNG’s “fiscal framework”—possibly a euphemism for the incredible level of exemptions, tax cancellation, credits and reduced BC Hydro rate initially extracted from taxpayers following earlier lobbying efforts by Andy Calitz, Zebedee’s predecessor and Calitz’s colleagues.

Another topic: “Development, establishment, amendment or termination of any program, policy or decision.” [Emphasis added.] Hmmm . . . .

Did those eight LNG Canada lobbyists actually contact government and public service officials? We don’t know. Under the current BC lobbyist rules, only the registration of lobbyists is publicly reported. Fortunately, that will soon change, as the 2018 Lobbyist Transparency Act finally takes effect this fall. After that, BC lobbyists will have to report each phone call, email or visit with an official—just as is now required of federal lobbyists.

One other minor detail. Among the requirements when registering is to reveal any funding “received or requested” from government agencies in the previous 12 months. LNG Canada dutifully reported that it has received big bucks from Innovation, Science and Economic Development Canada. The amount reported is $46.3 million. But I wonder if that isn’t a typo.

For on October 2, 2018, Prime Minister Justin Trudeau announced that LNG Canada would actually receive $220 million from the Strategic Innovation Fund, as well as a further $55 million from Western Economic Diversification Canada to replace the Haisla Bridge in the District of Kitimat, needed as a result of increased area traffic.

Not only that, Trudeau promised that “trade barriers would not get in the way of this generational project.” Translation: The feds plan to exempt LNG Canada from tariffs—worth an estimated $1 billion—when importing the Chinese-made modules for the LNG facility. I have asked the powers that be to check on LNG Canada’s reported amount from federal handouts.

What about the hit on BC taxpayers? Fortunately, the Province’s $6 billion worth of giveaways to LNG Canada are in the form of credits, reduced hydro rates and tax exemptions. While those look very much like smash-and-grab raids on the treasury, the lobbying rules explicitly exclude tax credits.

The total tab for taxpayers? Assuming that the Chinese modules do eventually make it to Kitimat, Ottawa and Victoria together are chipping in $7.275 billion.

As the much lamented chair of the BC Public Accounts Committee, the late Fred Gingell, might have said: $7.275 billion here, $7.275 billion there—and pretty soon it adds up to real money.

Russ Francis worked as a political columnist and reporter for many years before becoming a BC government analyst. During his 10 years with the government, he worked in strategic policy, legislation and performance management for a number of ministries. He’s happy to be writing again from his home in the Southern Gulf islands.

 

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