Unpacking the Billion Dollar Taxpayer Loss That Ontario’s Liberals Tried to Cover-Up

What began as Dalton McGunity's problem has quickly become Kathleen Wynne's. Photo via Facebook. 
Ontario’s Liberals are in hot water. Kathleen Wynne is in trouble, Tim Hudak is having a field day, and most everyone thinks that we’ll see an election this spring. If you’ve been paying any attention to provincial politics of late, you’ll know that the Liberal gas plant scandal—which has been an ongoing, evolving issue since before the 2011 election—is coming to a head.

Two weeks ago, the OPP alleged that in February 2013, just days before Kathleen Wynne was sworn into office as premier, one Peter Faist, computer expert and the boyfriend of former McGuinty chief of staff David Livingston’s deputy Laura Miller, logged onto four computers in the premier’s office to erase documents pertaining to two cancelled gas plants. The OPP allege that Faist was granted special access until March 20, and say they have enough to charge Livingston with criminal breach of trust, at the least. This is the first time in history that a Liberal premier’s top aide has faced potential breach of trust charges.

Cancelled gas plants Let’s back up, though. As with any good political scandal, the anatomy of the beast is such that understanding this clusterfuck requires a fair amount of context, as well as a timeline. This has been going on since before 2009 when TransCanada won a bid to build these plants, and it has been some time in the making. It just so happens that the latest gas plant scandal flare up involves a criminal OPP probe—but before this was a criminal scandal, it was a political one. The documents alleged to have been deleted by McGuinty are directly connected to two cancelled gas plants in Mississauga and Oakville, the cancellation of which will cost taxpayers more than one billion dollars, according to Auditor-General Bonnie Lysyk. Where does the one billion dollar figure come from? Well, it’s important to note a couple of things: first, that is the cost not just of cancelling the plants, but also includes the cost of relocating and building a new plant further away in Napanee. Second, that number indicates the costs spread out over the next twenty years on rate-based rather than tax-based terms. When we say that $1 billion dollars is rate-based and not tax-based, we mean that is how much the plant will cost based on the provider, not how much we will spend as taxpayers.

The number comes from cancelled contracts with TransCanada who won the bid to build the plants, as well as gas delivery and management services for the new Napanee plant, gas and hydro connections for that plant, the cost of additional gas for potentially less efficient turbines, transmission system upgrades, line losses for the distance power has to travel from Napanee, and for replacement power beginning in 2018.

That’s not cheap. You’re probably asking yourself why this happened in the first place. If the infrastructure in Southwest Ontario is such that we need new plants--why go to the trouble of setting up a costly contract with taxpayer money, only to break it and try again somewhere else? Well, the plants in Mississauga and Oakville were met with fierce opposition that was both very vocal and highly visible. Local communities and activists banded together to resist the project. In 2010, US activist Erin Brockovich spoke against the proposed plants at a fundraiser for Citizens for Clean Air Oakville. When it became clear that the project in Oakville would not be completed in time due to the strength of the opposition, Liberals backed down, eventually announcing the cancellation of both plants. Yes, it was political maneuvering. They didn’t want to lose the vote-rich GTA, and they got what they wanted in the end. During the 2011 election, Liberals held onto all of their seats in the Mississauga-Oakville area, but remained a minority government.

OPP probe and potential criminal activity

If the story stopped there, this would just be another political scandal. But, as the OPP has informed us, there is alleged criminal activity at play here. For obvious reasons, it remains highly illegal for government officials to destroy documents pertaining to official government contracts, amongst other things. The computers of two staffers are alleged to have been wiped clean altogether (with more than two dozen computers that were accessed and may have had files deleted off of them). Further, Miller has deleted thousands of emails implicating herself in the scandal, which have since been recovered by authorities.

The documents were alleged to have been destroyed at the behest of David Livingston, who was acting as McGuinty’s chief of staff—his most senior aide—at the time of the alleged crime. The documents were apparently destroyed during the transition period between McGuinty and Wynne’s premierships. Wynne assumed office on the 11th of February 2013 and the documents were destroyed on the 6th and 7th of that month. It’s likely that the gas plant scandal was the reason McGuinty left office so suddenly. Now it has come back on Wynne.

Despite the OPP’s claims that they’re not investigating Wynne’s office, and therefore must believe that McGuinty’s administration carried this out exclusively and without her knowledge or participation, Tim Hudak is really enjoying himself. He has claimed, over and over, with absolutely no proof, that not only was Wynne privy to the destruction of these documents, she oversaw the whole thing. “Now we know that since this happened during her time in the Premier’s office, she oversaw and possibly ordered the destruction of documents during the cover-up,” his official webpage proclaims loudly. Wynne served Hudak with a libel notice last Friday, but Hudak has said he has no plans to back down. He must know that if he says the same thing often and loudly enough, it will stick and people will experience issue-fatigue. Gas plants are not a sexy news topic, even if they are at the centre of an unfolding scandal.

At the moment, Miller, Faist, and Livingston are not cooperating with police, according to Detective Constable Duval of the anti-racketeering squad before the Standing Committee on Justice Policy, the official body that has been convened to look into this whole mess. Miller’s lawyer indicated that she would cooperate if she was given immunity but the police declined. It remains unclear at this point how much slack voters will be willing to cut Wynne on this issue at the polls, in what will most likely be a spring election. She is certainly implicated, and sometimes that’s all it takes.  @muna_mire