REGINA: The Canadian Taxpayers Federation (CTF) is calling on SaskTel to abandon plans to spend $310 million to bolster cellular, internet and television services.

On January 25 Sasktel announced plans to spend $310 million on its "Next Generation Access Infrastructure (NGAI) which will provide increased bandwidth to customers." A significant portion of the money will be directed at upgrading SaskTel's Max television service to provide live pay-per-view programming.

"The government has no business being in the internet and cell phone business - let alone televisions," said CTF Saskatchewan director David MacLean. "Saskatchewan one of the only jurisdictions in the world where the government owns all major utilities. It's not just a coincidence that our economic growth has lagged behind the rest of Canada."

Since the inception of the Max television project in 2001, SaskTel has not provided a detailed, activity-based accounting for the cost of the project. While it has been widely speculated that the original cost of the service was in excess of $60 million, SaskTel officials have been unable to confirm the figure. In a meeting between CTF director David MacLean and former SaskTel CEO Don Ching the company would not say with certainty how much Max TV was costing the public Crown. It's clear now that the true cost of operating a modern television service is much more than it was projected just three years ago. SaskTel is now a major player in home security, cellular phones, internet, and television.

"The question is whether Sasktel is cross-subsidizing its new business ventures with revenues from basic phone service," said MacLean. "Taxpayers deserve to know."

"If this is what the government views as economic development they can expect more of the same - losing people and capital to other provinces," added MacLean. "Part of the reason businesses choose not to invest in Saskatchewan is because they know that, no matter what line of business they are in, they are likely to wind up competing against their own tax dollars through government subsidies or government-owned businesses. Crown corporations are not like normal businesses. They do not pay many taxes and they benefit from favourable treatment from the government."