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Les Leyne: Hands on, then hands off, over and over

Loads of economic analyses were delivered this week about B.C. Hydro’s plight to support the NDP government’s contention it has to act to avert disaster.

Les Leyne mugshot genericLoads of economic analyses were delivered this week about B.C. Hydro’s plight to support the NDP government’s contention it has to act to avert disaster.

But this storyline has played out so often over the years, you have to wonder if there is some deep-seated psychological reason why taxpayers have to keep reliving the same crisis over and over again.

It looks as if B.C. politicians have a strange complex involving government-owned enterprises. There’s a compulsion to meddle in them, accompanied by an aversion to that interference when somebody else does it.

They take power and find the temptation to tinker with the Crowns — Hydro, ICBC, B.C. Ferries (before it was put at arm’s length) — is irresistible.

Then a new group takes over and condemns the old bunch for political interference that has brought us all to the brink of ruin.

Then, eventually, the new bunch succumbs to the same temptation. When it comes time to change sides again, the cycle repeats.

It’s a complicated affliction. The billion-dollar bailout committed this week just eases one of the symptoms; it doesn’t cure it.

The cycle renewed when the NDP government unleashed a blizzard of condemnation, some of it ordered up from consultants, about how the previous B.C. Liberal government ran B.C. Hydro.

There are pages of analysis showing every energy decision of the past 16 years was wrong and it’s all the Liberals’ fault.

“Step one in fixing this problem is to take the politics out of decisions around B.C. Hydro,” said Energy Minister Michelle Mungall — before delivering a political diatribe against the Liberals.

So there will be a big push to restore full oversight of B.C. Hydro to the independent B.C. Utilities Commission. The Liberals exempted an absurd number of energy initiatives from BCUC authority over the years. The list includes all the deferral accounts used to push costs into the future, the Site C dam, the reliance on independent power producers, all its long-range-planning assumptions and key factors in its overall budget.

Those issues and more will be handed back to the independent commission, which is going to have to be bulked up considerably to handle all that new work.

A variation on this theme is playing out at ICBC. It has been steadily running out of money for the past few years, to the point that Attorney General David Eby declared it a dumpster fire after the NDP took over in 2017.

It was mostly because the Liberals refused to allow the rate increases needed to cover the jump in crashes. They bypassed the BCUC because they were putting families first.

Eby rewrote the entire insurance regime in response to that crisis. He didn’t ignore the BCUC, he just gave it a fraction of the time needed to approve the changes.

Further back in time, the Liberals were so appalled by NDP meddling in the ferry system during the 1990s they divorced it from government completely.

But eventually, they succumbed and started dictating rate and route decisions.

Back at B.C. Hydro, the old game will resume in a new context. The BCUC will have much more authority. But the government wants to keep rate hikes to eight per cent over the next five years.

The billion-dollar writeoff eases some pressure on rates, but more savings are needed. So there will be yet another review of operations.

All the while, it will need a lot more approval from the utilities commission than it once did.

If it goes to plan, rate increases will be moderate. If it doesn’t, the politicians will once again face the irresistible compulsion to intervene, to avoid dealing with angry electricity customers.

There’s not much record on either side of withstanding that challenge, at Hydro or anywhere else.

Just So You Know: The hands-off NDP has already given itself an out. There’s a loophole to step in again if the mood strikes.

There’s a list of issues on which cabinet has already dictated policy, regardless of B.C. Hydro or the BCUC.

Plus: “Government anticipates that, on occasion, it will be required to provide direction to the BCUC to guide decision-making in proceedings that have implications for government policy.”

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