Meadow Lake mill to be sold
Author:
David Maclean
2006/10/24
There is new hope that the longest-running nightmare for Saskatchewan taxpayers may soon come to an end. Reports have surfaced in recent weeks suggesting there may be one or more businesses interested in purchasing the Meadow Lake Pulp Mill before the end of the year.
If this really happens, it will be welcome news for weary taxpayers.
The Meadow Lake Pulp Mill is the biggest money-loser in Saskatchewan history. Since the mill was launched by the Grant Devine government in the early 90's, the mill has cost taxpayers more than $800 million. Last year alone, taxpayers poured $76 million into the project.
According to court documents filed as part of court protection from its creditors, two formal offers for the mill were submitted in recent weeks.
However, the old saying "if it seems to good to be true it probably is" certainly applies here. To our knowledge, the mill has never turned a profit. Its debt has soared over the past 15 years. That means that a buyer would be taking on the money-losing operations as well as the liabilities. They won't do this out of the goodness of their hearts.
It would be almost miraculous if a private company were to simply take over the mill. The reality will undoubtedly be something well short of miraculous.
The objective for the government should be to unload the mill and its liabilities without paying an extortionary price. It will be a delicate dance. We wish the government luck.
Faux outrage from liquor store unions
When the Canadian Taxpayers Federation (CTF) publicized documents obtained from the Government of Saskatchewan through Freedom of Information relating to the bloated cost of running liquor stores, the reaction from politicians and big unions was fast and furious.
The problem, as identified by the CTF, is that the cost of operating liquor stores has jumped by 33 per cent since 2003. Since 65 per cent of the cost of running liquor stores goes to salaries of liquor store employees and head office workers, the first place to look for savings is in the payroll.
Since 2003, the payroll for liquor stores has jumped by 23 per cent. Some of that can be explained by liquor stores having longer hours but a 23 per cent increase is still statistically significant - especially when you consider that the amount of beverage alcohol sold in the province remains relatively constant from year to year.
If you look at the salary grid for liquor store employees, the reason for the increase becomes much clearer. In 2004, the top salary for a customer service representative was $18.61 per hour. In 2006 that same salary jumped to 14 per cent to $21.28. The top wage for liquor store managers jumped by 17 per cent over the same period.
Normally one would think that pointing out the bloated salaries of liquor store employees wouldn't be that controversial. But in Saskatchewan it's greeted with open hostility. In a media scrum, Liquor and Gaming Minister Deb Higgins demanded to know what this humble writer earns per year. She'll get that information when she starts paying my salary.
The straw man that unions conjure is the issue of public safety. In their minds only over-paid unionized workers are fit to sell a dangerous substance such as alcohol. The private sector simply cannot be trusted with such an important job. This argument is pure fantasy.
In Alberta, since liquor stores were privatized in 1994, incidents of impaired driving have declined by 73 per cent while Saskatchewan's have only dropped by 47 per cent. Incidents of crime related to alcohol remained constant in Alberta before and after privatization.
Think twice before you swallow government and union rhetoric. Their motivation is the preservation of high-paying union jobs - not the public good or customer service. Privatizing liquor stores would simultaneously save taxpayers millions each year and create opportunities for eager entrepreneurs.