Energy Minister Rich Coleman owes British Columbians a clear explanation for why the government paid $30 million to compensate a company for a cancelled uranium mining claim. So far, he has refused to provide one.
The New Democrats raised the issue in the legislature, citing documents relating to a last-minute settlement with Boss Power that headed off the company's court case.
There were three reports on appropriate compensation after the government instituted a ban on uranium mining, killing the company's plans for its claim near Kelowna.
Boss Power commissioned a report that found, unsurprisingly, it should get $96 million. A government report put the value at $5.6 million.
The court commissioned an independent review, which found the appropriate compensation would be $8.7 million.
So why, given that report, did the government agree to pay $30 million to the company, more than three times the independently assessed value of the cancelled claim?
One explanation would be that the extra $21 million was the price of avoiding an embarrassing public trial.
The government bungled the uranium mining ban. As late as 2007, Kevin Krueger, then junior mines minister, confirmed the government had no regulations or policy prohibiting uranium development. Boss Power had every right to proceed with its claim.
But in 2008, the government issued a statement saying it wouldn't allow development. Boss Power sued, claiming damages for money spent on the project and lost future returns. It said the government had encouraged its efforts to develop a mine.
The government's first statement of defence said the ban applied only to new projects, and Boss was free to go ahead. Ten months later, it brought in a retroactive ban that applied to Boss.
It's an erratic, anti-business way to make public policy.
Another explanation would be that the government paid a $21-million premium because of its wrongdoing. In 2008, before the ban, Boss Power applied to do exploratory work on its claim. Doug Sweeney, then the chief inspector of mines, was required by law to assess the application on its merits. But his masters in the ministry ordered him to ignore the application. Government lawyers told them that was illegal, but they insisted. Sweeney had legal and ethical concerns. He was pushed out of his job.
The government disclosed these facts as part of the legal process, leading Boss Power to claim for additional compensation because of "misfeasance of public office."
Coleman has provided no real explanation for the settlement. Government lawyers recommended it and the politicians agreed, he says.
The key question - why the settlement is so far beyond the independent estimate of appropriate compensation - remains unanswered. What factors led the government lawyers to recommend that amount, and the politicians to approve the payment?
The settlement revives the unanswered questions around the decision to pay $6 million in legal fees for Dave Basi and Robert Virk in return for guilty pleas in the B.C. Rail scandal.
And it again is a reminder of unresolved past issues. The decision to enrich Western Forest Products by some $200 million by releasing it from tree-farm licences without economic impact studies or efforts to seek public benefits in return has never been explained. Nor has its decision to allow Imperial Metals to renege on $3 million in interest payments on an ill-advised government loan made during the NDP years.
All governments make mistakes.
But citizens have a right to clear, honest explanations. So far, they have not had them in the Boss Power affair.
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