It was not a good week for Kathleen Wynne on the energy file. Actually, it’s never a good week for Wynne on the electricity front, and typically worse news for Ontarians.
First, a new study found skyrocketing electricity bills directly responsible for the loss of some 75,000 manufacturing jobs in the province. Then, a report from the Auditor General showed Ontarians will be on the hook for billions of dollars thanks to Wynne’s attempts to buy votes with short-term reductions to hydro bills.
The news is just the latest evidence of Wynne’s mismanagement, which extends well beyond electricity.
The report from the Fraser Institute found manufacturing jobs fell from 805,170 to 688,735 between 2008 and 2015, pinning 64 per cent of the blame on higher electricity costs, or 75,000 of the 116,435 positions lost.
Those numbers take into account global trends and the 2008 recession, from which every province but Ontario has recovered.
Auditor General Bonnie Lysyk, meanwhile, finds Ontarians are in for some long-term pain for the short-term gain of rate decreases ahead of next year’s provincial election. She says the government created a complex financing structure to keep the true financial impact of most of its 25 per cent electricity-rate reduction off the province’s books, a move that could cost Ontarians up to $4 billion more than necessary in interest costs over the next 30 years.
That’s in line with the Financial Accountability Office’s prediction that Wynne’s scheme could cost $45 billion over that timeline, with direct savings to the ratepayers of $24 billion – all of us being hit down the road for the $21 billion shortfall, a case of pay me now and pay me later.
“The accounting proposed by the government is wrong and if used would make the province’s budgets and future consolidated financial statements unreliable,” said Bonnie Lysyk after the report was tabled. “This cannot be taken lightly.”
“We’re not questioning the government’s policy decision to give Ontarians a discount on their electricity rates. What we are questioning is how the government is going to report the effects of that decision to the people of Ontario. There’s still time to fix it, and we’re encouraging the government to do so.”
Wynne is no stranger to criticism from the auditor general, who has found her government to be sweepingly incompetent and corrupt. Some Lysyk’s strongest language had been directed at the government’s handling of all things electricity. Hydro One’s transmission and distribution systems have become less reliable, yet their costs are increasing, for instance.
Ontarians are very familiar with the botched job Wynne has made of the electricity file. Quantified, Lysyk notes we paid a collective $37 billion more than market rates between 2006 and 2014. In that time, the price paid by residential customers rose by 70 per cent. While prices reflected increased costs for dealing with an aging system, much of the overpayment can be traced to poor policies. The Liberals routinely ignored expert advice – and even common sense – in pursuit of ill-advised policies and political patronage and vote-buying, decisions that went well past the billion dollars flushed away on the gas plant fiasco.
Despite all the extra money we’ve been dumping into it, the electrical system continues to worsen, at a high risk of failure.