TORONTO – A proposal to sell 60 per cent of Hydro One to the private sector would be a lucrative “double play” for Bay Street but a monumental loss for Ontario as a whole, the Ontario Public Service Employees Union says.
The Premier’s Advisory Council on Government Assets, led by former bank CEO Ed Clark, made the proposal today in a report to the Wynne government.
“What Ed Clark has proposed, combined with what Kathleen Wynne is planning, would see public dollars filtered through Bay Street twice,” OPSEU President Warren (Smokey) Thomas said. “First, the sale of shares in Hydro One would give private investors the lion’s share of profits from provincial electricity transmission. Second, Kathleen Wynne is planning to take the proceeds from the sale and pour them into public-private partnerships to build transit.
“The result is that Ontarians lose twice: first when we sell the asset, and second when we spend the money we get from selling the asset,” he said. “The only winners are banks, corporate law firms, and construction companies with close ties to the Liberal Party.”
In December, Auditor General Bonnie Lysyk reported that the province paid $8 billion too much when it used public-private partnerships (P3s) to build 74 major infrastructure projects.
“According to the Auditor General, those 74 P3s cost us 29 per cent more than they would have if the government had used traditional public-sector procurement,” Thomas said. “So if the government gets $9 billion from selling shares in Hydro one, and uses $4 billion of that to build transit, as Mr. Clark says it will, then Ontarians will be donating over a billion new dollars to the provincial privatization industry.
“If this sounds like a massive rip-off, it’s because it is,” he said. “Rather than cozying up to the richest corporations in Ontario, Kathleen Wynne should be calling on them to do their share in getting the province’s books in order. With corporate profits now at record levels, now is the perfect time to put provincial corporate tax rates back up to where they were five years ago.
“That move alone would raise $2.3 billion for provincial coffers,” Thomas said. “We could make even more if we doubled the increase for banks.”