Energy: Tory leader doubts government has shown true total; political scientist says it's 'small potatoes' in the bigger picture.
BRETT BUNDALE TELEGRAPH-JOURNAL
FREDERICTON - The Graham government spent $8.06 million on the proposed deal to sell NB Power assets to Hydro-Québec
The cost of sole-sourced contracts for legal, financial and communications services related to the energy deal were released late Monday
Legal and technical services cost $4.82 million, communications services cost $2.33 million and financial services cost $911,500.
"We committed to give a full accounting of all the expenses associated with the costs of the NB Power/Hydro-Québec agreement and to be open and transparent," Finance Minister Greg Byrne said. "We've done that today with the release of all the figures associated with the transaction."
But Progressive Conservative leader David Alward questioned the $8-million price tag, saying the figure lacks transparency.
"The $8 million is hogwash," he said. "Guaranteed it's much more than that."
Alward said he would like a breakdown of all the costs as well as the specific invoices from each consulting firm.
Documents released by the Department of Finance include the names of the firms engaged by the government for the proposed power pact, the services they provided and the total cost of the contract.
Premier Shawn Graham's plan to sell NB Power, and later a scaled-down deal to sell 10 power plants, faced public outcry and dissent from within the Liberal caucus.
Talks with Quebec collapsed in March, leaving the public utility with a debt of nearly $5 billion and ratepayers with another three-per-cent increase in electricity rates.
The Opposition Conservatives and citizens' groups such as the Coalition of New Brunswickers have been calling on the government to reveal the costs of the energy deal for months.
Given the complexity of the proposed deal, Byrne said it was necessary to seek out the service of experienced firms that are leaders in their field.
"It was very important that we get the best advice possible when entering into this deal," he said. "This was a transaction that was going to chart the course for New Brunswick for years to come."
The contracts were untendered because of the "very specialized services provided," Byrne said.
Osler, Hoskin and Harcourt LLP, a business law firm and the government's main legal counsel and lead negotiators, cost the province $2.43 million.
Washington-based economic consulting firm NERA, which issued a report showing ratepayers in New Brunswick would save billions on their power bills under the proposed deal, received $917,400 for "detailed economic analysis and rate modelling."
MacQuarie Capital Markets, the government's main financial services firm working on the energy deal, was paid $882,900 to provide independent financial advice to ensure the "best overall value" for New Brunswick.
The services of Hill and Knowlton, the main communications firm hired by the government to provide "various public affairs services," cost the province $892,000.
Hill and Knowlton subcontracted the services of the communications firm Colour to "oversee and provide editorial, design and creative content for advertising, as well as purchasing ad placements" for $1.22 million.
Alward said the "millions of taxpayers' dollars wasted is because of a premier that bulldozed forward with a decision that did not involve the people."
The Tory leader added that he suspects the real costs behind the scrapped power deal are closer to $30 million.
However, Byrne dismissed that figure, calling it "disingenuous at best."
Byrne added that the previous Conservative government spent $16.5 million restructuring NB Power and examining the potential sale of Point Lepreau and Coleson Cove.
University of New Brunswick political science professor Don Desserud said that although $8 million seems like a large sum to individuals, for a government it's "small potatoes."
"It's frustrating from the public's standpoint because it seems like a lot, but to be fair it's not that big," Desserud said. "In the bigger category of the whole NB Power fiasco, this is a little bit of extra annoyance."