Wednesday, July 04, 2007

TILMA: Pre-election flip-flop destroys Saskatchewan Party Leader Brad Wall’s credibility

Saskatchewan Party Calls On NDP To Join In Western Trade Pact”
Saskatchewan Party News Release Headline, May 1, 2006

“The province of Saskatchewan should be there as a part of this accord.”
Saskatchewan Party Leader Brad Wall, Saskatchewan Legislature, May 18, 2006

“I have no idea what’s scary about what B.C. and Alberta are doing...there is opportunity for us in our view and nothing to be worried about.”
Saskatchewan Party Leader Brad Wall, Regina Leader-Post, June 7, 2006

“[Saskatchewan Party Economic Development Critic Lyle] Stewart said a Saskatchewan Party government would seek a similar agreement with other western provinces.”
Saskatchewan Party News Release, August 4, 2006

“[T]here’s no way that [The NDP] will sign on to the TILMA agreement before the next election. It’s going to take a new government…to do bold things like sign on to the TILMA agreement and get this province rolling.”
Saskatchewan Party MLA Elwin Hermanson, Saskatchewan Legislature, March 26, 2007

After a year of repeatedly saying that it supported the BC-Alberta Trade, Investment and Labour Mobility Agreement (TILMA), and would sign it if elected, the Saskatchewan Party has now officially come out against the trade deal – sort of.

In a pre-election damage control move to extricate itself from the growing criticism and controversy surrounding TILMA, Saskatchewan Party Leader Brad Wall, under the cover of a long-weekend news release and a recent report by an all-party legislative committee examining the trade deal, flip-flopped his party’s position by saying it would not sign the agreement “in its present form.”

The careful wording would seem to allow Wall the leeway to consider signing TILMA in a different form should one emerge at a later date.

In the June 28, 2007, news release Wall blamed the Saskatchewan NDP government for his party’s about face saying it was because the province “did not take part in the original TILMA negotiations with BC and Alberta” and “had no part in negotiating its terms.”

This ignores the fact that it was British Columbia that first approached Alberta with a proposal to negotiate a comprehensive bi-lateral agreement on trade, investment and labour mobility. On October 8, 2003, the Governments of British Columbia and Alberta signed a joint Protocol of Co-operation, identifying the goal of expanding trade, investment and labour mobility between the two provinces. On May 26, 2004, the two governments signed an Internal Trade Framework Agreement confirmed as the basis for consultations and negotiation of a comprehensive bilateral agreement to enhance trade, investment and labour mobility between the two provinces. None of these documents appears to suggest that other provinces or territories would or should be involved.

It also ignores the fact that the negotiations between BC and Alberta were conducted behind closed-doors and that no consultation with municipalities, the public or legislative debate took place prior to the agreement’s signing on April 28, 2006.

Forgotten is the Saskatchewan Party’s May 1, 2006, news release calling on the NDP government to join the agreement and Wall’s condemnation of Premier Lorne Calvert in the legislature on May 1 & 2 for not being at the table with BC and Alberta during their closed-door meetings and for not immediately signing the trade deal – without proper consultation or study.

In the legislature on May 18, 2006, Wall again berated Premier Calvert and said the province of Saskatchewan should be part of the accord.

On August 4, 2006, then-Saskatchewan Party Economic Development Critic Lyle Stewart said a Saskatchewan Party government would seek a similar agreement with other western provinces.

During his many tirades Wall raised no concerns with TILMA “in its present form”.

The news release and Wall’s comments appear to be politically motivated and nothing more than a pathetic attempt to divert attention away from his party’s support for a reckless, destructive and increasingly divisive trade agreement.

If the Saskatchewan Party is capable of this kind of deception and hypocrisy as the official opposition what do the people of Saskatchewan have to look forward to should it be asked to form the next government?

“The Saskatchewan Party strongly supports the reduction of inter-provincial trade barriers as a means to grow Saskatchewan’s economy and create new jobs,” Wall said in the news release.

Unfortunately, the news release does not provide a list of genuine trade barriers between provinces that Wall thinks should be removed.

Furthermore, on April 3, 2007, an Edmonton Journal editorial said there is “little in the way of genuine trade barriers remaining between the two westernmost provinces” and Saskatchewan Party Leader Brad Wall said in a news release that Saskatchewan is “the lowest cost jurisdiction…with fewer trade barriers and restrictions than either B.C. or Alberta.” Wall seems to have forgotten that he made these comments.

In the June 28 news release Wall said the Opposition’s own research and the TILMA hearings raised specific concerns about three areas which are not clearly addressed in the current TILMA agreement:

1. The protection of Crown Corporations;
2. The exemption of provincial new growth tax incentives; and
3. The potential loss of new growth tax incentives at the municipal level.

Curiously, despite his party’s own research, Wall never brought these concerns forward last year when he was hysterically calling on Premier Calvert to sign the agreement. And yet in the legislature on May 2, 2006, Wall had the gall to suggest that NDP Government Relations Minister Harry Van Mulligen had not done his homework on the TILMA file.

This seems to be a case of the pot calling the kettle black. During a speech at the 2006 Saskatoon Leader’s Dinner on March 2, 2006, at TCU Place, Wall proudly proclaimed that when it comes to his party “We are doing our homework.”

Then there is Wall’s March 19, 2007, letter to the City of Saskatoon outlining the three criteria that would have to be met in order for his party to sign TILMA:

1. That it not negatively impact on the public ownership of the major Crowns
2. That it not negatively impact environmental standards
3. That it not negatively impact the well-being of workers.

The exemption of provincial new growth tax incentives and the potential loss of new growth tax incentives at the municipal level mentioned in the June 28 news release are absent from the list – and yet the Saskatchewan Party claims it does its homework.

Not only would TILMA adversely affect municipalities it puts at risk important policies and programs that are in the public interest to maintain.

TILMA’s list of exceptions include measures relating to Aboriginal peoples; water; regulated rates established for the public good or the public interest; social policy, including labour standards and codes, minimum wages, employment insurance, social assistance benefits and worker’s compensation; compensation to persons for losses resulting from calamities such as diseases or disasters; assistance for book and magazine publishers, sound recordings, and film development, production and distribution; assistance for recreation, academic research or to non-profit organizations; the management and disposal of hazardous and waste materials; and the management or conservation of forests, fish and wildlife.

A measure includes any legislation, regulation, standard, directive, requirement, guideline, program, policy, administrative practice or other procedure.

Article 17 of the agreement requires a ministerial committee to “review annually the exceptions listed...with a view to reducing their scope.”

The exceptions in TILMA will shrink over time and are by no means safe. The Conference Board of Canada’s impact assessment for the BC Government confirms this stating “TILMA is considered to be an improvement… since future negotiations can focus on the removal of the exceptions from the explicit exclusion list.”

Furthermore, an October 2006 TILMA fact sheet states that “if a measure is not clearly identified as an exception, it is subject to the rules of the agreement.”

Since health and education measures are not clearly identified as exceptions, it would seem they, too, could be at significant risk.

Wall has refused to say whether a Saskatchewan Party government would ensure that these important measures are permanently exempt from any trade agreement it might consider signing. His silence on the issue and the fact that they aren’t included in the June 28 news release or Wall’s March 19 letter to the City of Saskatoon seems to indicate that his party has little or no intention of protecting these areas.

Wall stated in the June 28 news release that he was also concerned about the lack of formal input from Saskatchewan cities.

“Our Enterprise Saskatchewan plan for the economy involves direct input from stakeholders including the municipal sector,” Wall said. “How could we enter into a major trade and investment agreement without their formal input and assessment?

Where was Wall a year ago when similar concerns, along with many others which he refuses to recognize, began coming forward from various organizations and individuals? Why is it only now in the eleventh hour that he is willing to acknowledge their validity?

Enterprise Saskatchewan was announced on September 21, 2004, as part of Saskatchewan Party Leader Brad Wall’s “new economic vision” for the province outlined in the document The Promise of Saskatchewan: A New Vision for Saskatchewan’s Economy. While it predates TILMA by nineteen months it offers some insight into what Wall believes are barriers plaguing Saskatchewan.

In an address that day to more than 200 students at the University of Saskatchewan’s College of Commerce Wall said Saskatchewan must shed its dependence on public sector intervention and begin to build a larger private sector as the primary economic driver.

“The goal of our Enterprise Saskatchewan plan is to create an aggressive, agile and entrepreneurial economy within a stable and positive business environment that removes the politics from economic development and can survive Saskatchewan’s volatile election cycle.”

Wall said Enterprise Saskatchewan will focus on Saskatchewan’s key economic sectors and implement a broad plan consisting of, but not limited to fifteen elements, one of which “will develop a systematic and ongoing process to identify and remove barriers to growth in each of our key economic sectors.”

Apparently the number of barriers in Saskatchewan is substantial. According to Wall, “Saskatchewan Party MLAs have spent a great deal of time meeting with various industry groups and economic development organizations to identify barriers to growth in key economic sectors. We understand the many and varied barriers that exist.”

The word barrier occurs 40 times in the plan. While no attempt is made to provide a separate, comprehensive list, Wall does refer to the following as barriers:

– Direct competition to business from various government agencies
– Crowns attempting to diversify from core functions; policies of the Crowns themselves
– Inadequate access to bandwidth
– Lack of high-speed internet access in parts of the province
– Corporate income taxes
– The resource surcharge
– Shortage of skilled labour
– Poor infrastructure (i.e. high quality roads)
– Red tape
– Government permitting
– The PST
– Financial institutions taxed at a higher rate than manufacturing firms
– High fuel taxes

One barrier that Wall mentions a few times is the corporate capital tax which he calls “insidious” and “penalizes private sector investment” yet in the next breath says that it is an area “the government of Saskatchewan may not be in a position to offer meaningful reductions” and “will be too costly to be eliminated or significantly reduced immediately.” So it would appear that even though Enterprise Saskatchewan promises to identify and remove barriers it might not apply in this case. It makes one wonder how many others would meet a similar fate should the Saskatchewan Party form government.

It is unclear whether an agreement like TILMA is the appropriate vehicle for addressing Wall’s barriers. He does not appear to be citing them when commenting on the trade agreement. To date Wall has not produced a list of genuine trade barriers between provinces and has described Saskatchewan as being “the lowest cost jurisdiction…with fewer trade barriers and restrictions than either B.C. or Alberta.” Yet, it seems through constant rhetoric that he and his party continue to create an atmosphere of crisis suggesting barriers exist in such great numbers that it is threatening the province’s very existence.

It is interesting to note that the word investment appears 80 times in Wall’s economic vision while social occurs just 3 times. Page 26 appears to provide a glimpse of where social issues are situated on Wall’s list of priorities:
“In 1996, a KPMG study on location cost analysis highlighted the need for Saskatchewan to become competitive on taxes and stability. Investors were worried about the stability of the business environment and the potential for radical changes in operating conditions. Indeed, the study recommended more partnerships between stakeholders through a provincial economic development authority. The study also pointed out that investment decisions are driven by financial factors, not quality-of-life considerations. It recommends Saskatchewan emphasize its attraction in business terms, not social ones, when marketing itself to outside investors.

“Let us not lose sight of the basics. Saskatchewan must be competitive in terms of taxes, regulation, the availability of venture capital, and innovation.

“An enterprising, entrepreneurial Saskatchewan economy will be impatient, relentless, aggressive, self-promoting and even brash. Profit within that economy will be lauded instead of envied.”
In Wall’s world it would seem that investor rights and interests trump social and quality-of-life considerations.

In his party’s June 28 news release leader Brad Wall said “We know that Alberta and BC officials have indicated that having Saskatchewan sign on without any revisiting of the agreement would not make sense for those two provinces either.”

This is not new information. The BC Government – who initiated TILMA – publicly stated its position on the matter last year.

In a speech to the BC Business Council and Canada West Foundation on December 13, 2006, BC Premier Gordon Campbell had this to say about TILMA:
“So we’ve said to Saskatchewan we’d like to tell you how the agreement’s working; we want to show you how the dispute resolution works; we want to show you the penalties; we want to show you what we’re doing. We’d love you to join us, but these are the rules.

“I talked with Premier McGuinty in Ontario about Ontario joining British Columbia and Alberta. I said to Premier McGuinty: “You’re the biggest province in the country, Dalton. You guys are important to all of us. By the way, we’re not changing the agreement, but you’re welcome to join.””
In Provinces unite to tackle skill shortages (Vancouver Sun, Dec. 14, 2006) Premier Campbell said Saskatchewan and Ontario are welcome to join TILMA “provided they don’t try to tinker with the deal.”

Given Brad Wall’s apparent fondness for BC and Alberta style governance and the claim that his party does its homework it seems reasonable to think that he knew about this long ago. So why is he only bringing it up now and using it as an excuse for not signing the agreement?

Wall’s affinity for Alberta and its conservative government is well known.

During a speech to the North Saskatoon Business Association on December 8, 2005, at the Delta Bessborough Hotel, Wall said:
“I have spoken to many of those seeking to replace Mr. Klein in Alberta, and to Mr. Klein himself and they welcome the day when Saskatchewan will join Alberta and B.C. at the table to earnestly work together in areas of public policy including energy policy and the reduction of inter-provincial trade barriers.

“They are waiting. I have already told them that a Brad Wall government will be at that table.”
In his March 2, 2006, Saskatoon Leader’s Dinner Speech, Wall said that then-Alberta Premier Ralph Klein invited him to attend his annual Global Business Forum in Banff in September 2005.

“The Premier of Alberta informed me of high level meetings between his province and BC to look at ways of reducing inter-provincial barriers to growth and trade,” Wall said.

Wall went on to say “I am announcing tonight that I have tasked Sask. Party Cutknife-Turtleford MLA Michael Chisholm to focus exclusively on the opportunities of western economic cooperation so that we may send a clear but unpretentious message to other western capitals that a new government in Saskatchewan means a leading partner for them in the emerging New West and a strong new voice for Saskatchewan at the Council of the Federation of this country.”

In a March 3, 2006, Saskatchewan Party news release Wall followed up on the Chisholm announcement stating:
“We want to send a clear message to other western capitals that a new government in Saskatchewan will mean a leading partner for them in this emerging new west,” Wall said.

“Inter-provincial trade barriers, regulations and barriers to growth will be the focus of this Saskatchewan Party initiative.”
In Deal interests Sask. premier (Regina Leader-Post, June 7, 2006), it was reported that Saskatchewan Party Leader Brad Wall met with then-Alberta Premier Ralph Klein in Calgary on June 5, 2006, “where the main topic of discussion” was TILMA.

“I have no idea what’s scary about what B.C. and Alberta are doing…there is opportunity for us in our view and nothing to be worried about,” Wall was quoted as saying.

In the Saskatchewan Legislature on April 2, 2007, on the subject of TILMA, Wall said:
“We met with officials in Alberta and BC — both elected and the senior civil servants — who were part of negotiating that agreement. We asked questions about how would this impact our Crowns, which is very important to the province. How would it impact the autonomy of municipalities? We were doing our homework.”
It seems the Saskatchewan Party might have been privy to some of TILMA’s details prior to its signing and also that the governments of BC and Alberta were not interested in changing the agreement for other provinces, but the party chose to say little about it until its June 28, 2007, news release. Why?

Lastly, Wall said in the June 28 news release that he prefers other modes of western economic cooperation including Saskatchewan’s involvement in the Pacific North West Economic Region (PNWER) and he has already indicated that a Saskatchewan Party government would hold joint cabinet meetings with other western provinces to explore opportunities to cooperate in areas such as health care equipment and pharmaceutical purchases.

Wall neglected to mention that it was through closed-door joint cabinet meetings that led to TILMA in the first place. It seems Wall is eager to drag Saskatchewan down that road as well.

As for its support of PNWER the Saskatchewan Party appears to be in lock step with Conservative Prime Minister Stephen Harper’s trade agenda.

In a speech delivered at the 2007 Saskatoon Saskatchewan Party Leader’s Dinner on March 8, 2007, at TCU Place, Wall said, “Then there is PNWER (the Pacific Northwest Economic Region). Another regional dynamic group of northwestern states together with Alberta and BC who are cooperating to build the Asia Pacific Gateway…I have asked our critic for Western Economic Cooperation Mike Chisholm to focus on this opportunity.”

A few weeks later Prime Minister Harper had this to say at a May 4, 2007, press conference in Vancouver: “It’s hard to overstate the importance of Asia-Pacific trade to Canada’s economic future. The Gateway Initiative is obviously critical to realizing our potential as a country.”

“Our Government has now committed over $1 billion to this Initiative…And in the longer term, we intend to develop an Atlantic Gateway on the East Coast.”

The press conference also gave Harper the opportunity to showcase his support for TILMA: “This is a bold step that has been undertaken by two forward-looking provinces committed to successfully competing in global markets, and I believe their success will set an example other provinces will find hard to resist.”

Wall’s agenda appears to go well beyond TILMA and could include joining PNWER who are studying the BC-Alberta trade agreement as well.

On July 18, 2006, PNWER’s Trade & Economic Development Work Group resolved to “embrace the opportunity to educate and explore the possibility of expanding the B.C.-Alberta Trade, Investment and Labour Mobility Agreement (TILMA) concept throughout the PNWER region.”

The 17th PNWER Annual Summit is scheduled for July 22-26, 2007, in Anchorage, Alaska. The Trade & Economic Development portion of the agenda is set for the morning of July 24, 2007, where an update on the 2006 Working Group Action Items regarding TILMA will be discussed. Mr. Shawn Robbins, Director of Internal Trade for Alberta International and Intergovernmental Relations is confirmed to attend.

The controversy and debate surrounding TILMA may be far from over.

The Saskatchewan Party and its leader Brad Wall’s support for the agreement last year was unequivocal. One might wish to keep in mind the old adage that “a leopard cannot change its spots.”


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