Showing posts sorted by relevance for query P3. Sort by date Show all posts
Showing posts sorted by relevance for query P3. Sort by date Show all posts

Tuesday, July 24, 2007

Contracting Out Is A Crime

Once again the attempt by the Liberals to Reinvent government, the mantra of the neo-con revolution of the nineties, ends up costing Canadians millions. Whether it was the P3 Boondoggle with the Firearms registry, the RCMP pension fund fraud or this case where the Department of National Defense was bilked for millions. It all has to do with contracting out and outsourcing IT functions of the State.



Ex-federal employee guilty of huge fraud

A former defence bureaucrat, who led a jet-set lifestyle, pleaded guilty today to two charges in a phoney contract billing scheme that bilked $146-million out of the federal government before it was stopped.

Paul Champagne, who had been an $80,000-a-year contract manager with the department, pleaded guilty to one count of fraud and one count of breach of trust in an Ottawa courtroom.

He was fired from his job in 2003 after billing irregularities were revealed involving a contract with U.S. computer giant Hewlett-Packard.

After a lengthy RCMP investigation, Champagne, 49, was charged with seven fraud-related crimes. After he pleaded guilty today to two charges, the Crown dropped the remaining five counts.

He will be sentenced in January.

In the late 1990s, the Defence Department issued a series of contracts to Hewlett-Packard (Canada) Inc., eventually paying $159 million for computer maintenance services. The government later discovered it got little or nothing for its money.

The Public Works Department red-flagged the contracts over the four years prior to Champagne's dismissal, but did nothing. A scathing report in 2003 found that managers at the federal government's tendering department failed to appreciate the significance of at least three audits that warned something was terribly wrong with the computer contracts.

After the scandal became public, Hewlett-Packard said it was told by the department to pay a group of subcontractors and their work was deemed secret.

In May 2004, the computer giant repaid $145 million to the federal government, and said its employees did nothing wrong.

Two Ottawa businessmen, Peter Mellon and Ignatius Manso, were also charged, but the Crown said Monday only one case remains to be resolved. A spokesman for the RCMP couldn't say what the status of the cases might be.

Over 10 years, starting in 1993, five contracts worth a total of $250 million were signed with the Compaq Computer Corp., Digital Equipment and Hewlett-Packard, which eventually bought Compaq.

Audits conducted by Public Works in 1999 and 2000 raised concerns about three of the contracts, but in 2001 a further review found unauthorized billing and "evidence of contractual funding appropriated for other purposes."

After Champagne was fired, National Defence did its own internal review of contracts and discovered problems with two dozen other projects. Today, the Defence Department did not respond to requests for comment about what safeguards have been put in place to prevent a repeat of the fiasco.

At the time of his arrest Champagne was a multimillionaire, who insisted his wealth and homes in exclusive districts of Ottawa, Florida and the Turks and Caicos were the results of shrewd investment in high-tech stocks during the tech boom of the late 1990s.

SEE:

Defense Lobbyist Now Minister



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Wednesday, April 11, 2007

Public Pensions Fund Private Partnerships


The battle of publicly funded pensions funds, your money and mine, being used in collaboration with private equity firms, hedge funds, to do leveraged buyouts needs to be seriously addressed, since those who pay into these funds have no controlling say over the fund managers.

As Robert Blackburn of New Left Review has written, the pension funds created over the past fifty years are huge new source of capital available for use to shore up capitalism.

But it is still public money, from union or public sector and government pensions. But without any meaningful corporate regulations giving the owners of these funds, us, any say in how they are invested. The democratization of public and institutional funds needs to be on the agenda of unions, the left, and the public. While institutional funds like pension funds call for their rights as shareholders, they do not allow their own shareholders the same rights of representation.

Teachers' BCE campaign gaining support

Some of BCE Inc.'s largest shareholders are lining up behind the Ontario Teachers Pension Plan and pledging to support the pension fund if it attempts to lead a takeover of the telecommunications company or even oust its embattled senior management.

Teachers, exasperated with BCE's weak stock performance under chief executive officer Michael Sabia, has already approached U.S. buyout firm Providence Equity Partners Inc. to explore a bid for the company worth close to $40 a share, according to sources.

That hefty price -- about a 30-per-cent premium to where BCE was trading last month -- could be enough to sway many of the company's long-suffering investors if Teachers decides to act. Although it chose not to submit a formal bid after BCE indicated it wasn't interested in selling, Teachers ratcheted up the pressure on the company in a regulatory filing this week by signalling its intentions to shift from a passive investor to an active one. Several investors said the only way BCE may be able to fend off an unwanted suitor now is for Mr. Sabia to step aside.

He said Teachers, like many investors, has become frustrated by what it views as unresponsive management and the glacial pace of Mr. Sabia's turnaround strategy.

In a filing with U.S. regulators on Monday, the pension fund said it was "exploring its options" regarding BCE, and sources confirmed it has been in contact with several buyout firms and pension funds in both Canada and the United States about the prospect of a takeover. The filing came less than two weeks after it was revealed that BCE had spurned another advance from private equity titan Kohlberg Kravis Roberts & Co., which has allied itself with the Canada Pension Plan Investment Board.

These sources described the KKR advance as a "wake-up call" for Teachers, which is bent on leading any privatization effort of the Montreal-based parent of Bell Canada. One person familiar with the matter said the $106-billion pension fund is dismayed by the cool reception its proposals have received from both Mr. Sabia and BCE chairman Richard Currie. Mr. Sabia and Mr. Currie could not be reached for comment.

"At some point the shareholders will speak," said one person familiar with Teachers' plans. "Boards of directors are supposed to represent the shareholders at the table."

See

P3

AIM High

Your Pension Dollars At Work

P3= Public Pension Partnerships



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Thursday, April 18, 2024

21ST CENTURY ALCHEMY

Gold may be key element for cleaner drinking water


UCF researchers are using gold to develop a novel method to remove toxins from drinking water


UNIVERSITY OF CENTRAL FLORIDA

UCF Engineering researchers Woo Hyoung Lee and Yang Yang 

IMAGE: 

UCF RESEARCHERS WOO HYOUNG LEE AND YANG YANG ARE LEADING A PROJECT TO USE GOLD TO DEVELOP A NOVEL METHOD TO RID DRINKING WATER OF HARMFUL ALGAL BLOOMS.

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CREDIT: UNIVERSITY OF CENTRAL FLORIDA




Writer: Marisa Ramiccio 11

ORLANDO, April 18, 2024 – Gold may be a coveted precious metal, but it could also be the key to cleaner drinking water.

A team of UCF researchers is exploring the use of the metal to develop a novel method to rid drinking water of harmful algal blooms, or HABs, which occur when colonies of algae grow out of control and produce toxic or harmful effects on people, fish, birds and other living creatures.

Their project is supported through the U.S. Environmental Protection Agency’s People, Prosperity and the Planet (P3) program, which recently awarded $1.2 million to 16 collegiate teams across the United States.

UCF received $75,000 for their two-year project that aims to develop a gold-decorated nickel metal-organic framework (MOF) that removes microcystins — toxins produced by harmful algae blooms — from the water. MOFs are porous clusters of metal polymers that are used in many practical applications.

The UCF student team includes environmental engineering doctoral student Samuel Adjei-Nimoh, materials science and engineering doctoral student Nimanyu Joshi, and environmental engineering undergraduate students Jennifer Hughes and Julia Going. The principal investigator of the grant is Associate Professor of Environmental Engineering Woo Hyoung Lee, and the co-principal investigator is Associate Professor of Materials Science and Engineering Yang Yang.

“MOFs have been used as a catalyst for many research areas such as hydrogen storage, carbon capture, electrocatalysis, biological imaging and sensing, semiconductors and drug delivery systems,” Lee says. “In this project, we’re using the gold-decorated nickel MOF as a photocatalyst to remove water pollutants.”

The gold will be coated in an MOF, which will help it react to the sunlight. That reaction, known as photocatalysis, will result in the oxidation of the microcystins, removing them from the water.

Microcystins are the most common cyanotoxins linked to harmful algal blooms in freshwater environments, notably in regions such as Florida with abundant lakes. They’re known to cause liver damage, kidney failure, gastroenteritis and allergic reactions in humans. With the UCF team’s novel solution, water treatment facilities can produce cleaner, safer drinking water.

"Clean drinking water isn't just a necessity, it's a fundamental right, especially for Floridians who rely on our abundant lakes and waterways,” Lee says. “By leveraging the innovative nanotechnology for water treatment,  we're not only removing toxins but also safeguarding the health and well-being of our communities, ensuring a brighter, healthier future for all.”

This is Lee’s second consecutive year receiving the P3 award. In 2023, his team was selected for their work on a biosensor that could detect microcystins early in their formation for faster eradication.

This is the 20th anniversary of the P3 program. Projects funded this year will tackle critical issues such as removing PFAS from water, combating harmful algal blooms, and materials recovery and reuse, says Chris Frey, assistant administrator for the U.S. Environmental Protection Agency's Office of Research and Development, in a release.

“I commend these hardworking and creative students and look forward to seeing the results of their innovative projects that are addressing some of our thorniest sustainability and environmental challenges,” Frey says.

About the Researchers

Lee is an associate professor in the UCF Department of Civil, Environmental and Construction Engineering. He received his bachelor's degree in environmental engineering from Chonnam National University in 1996, his master's degree in environmental engineering from Korea University in 2001 and his doctoral degree in environmental engineering from the University of Cincinnati in 2009. Before joining UCF, he was an Oak Ridge Institute for Science and Education postdoctoral research fellow at the U.S. Environmental Protection Agency's National Risk Management Research Laboratory in Ohio.

Yang holds joint appointments in UCF’s NanoScience Technology Center and the Department of Materials Science and Engineering, which is part of the university’s College of Engineering and Computer Science. He is a member of UCF’s Renewable Energy and Chemical Transformation Cluster. Before joining UCF in 2015, he was a postdoctoral fellow at Rice University and an Alexander von Humboldt Fellow at the University of Erlangen-Nuremberg in Germany. He received his doctoral degree in materials science from Tsinghua University in China.

CONTACT: Robert H. Wells, Office of Research, robert.wells@ucf.edu

 

Monday, November 03, 2008

Pension Rip Off


Canada's corporations are crying the blues again about the fact that they have underfunded liabilities regarding their pension obligations to their workers. While they may have a point that the government discourages them from putting extra into their pension funds, the fact is that they use this excuse to not max out their share of their pension responsibilites. Much like the government itself with its public sector plans, which are paid for by employers and employees, but the government never puts in its share, instead it uses its general funds to account for its future liablities, which of course gets it into trouble during periods of economic downturn and when the state runs up deficits and gets into debt as it did in the ninties.
That being said while corporations could benefit from legislative changes to the tax code, the fact remains that they would still prefer to invest in stocks and to pay their CEO's lucrative salaries and pay generous dividends to their shareholders before they invest in their own workers. Surprise, surprise. Now that market has melted down they cry the blues about not having paid their share into their future obligations to those who produce their wealth; their workers.

Wednesday, November 29, 2006

Timmies Takes Bite Out of Taxpayers


Tim Hortons for troops less pricey than reported Sure it was first reported that you and me, the Canadian taxpayer were in hock to Timmies for a cool $4 million for setting up their franchise in Kandahar for our troops.

Now the good news. We are only paying $1.4 million for this P3.

And while we pay $80,000 a month for the Timmies operation,
the gross profit for the Tim Hortons is five-thousand dollars a day.

But they did wave the franchise fee of $450,000. Gosh thats like well one third of what it's costing you an me to set up the franchise. And the fee waiver will probably be a tax write off. Mighty generous of them considering they are pulling in $150,000 a month. Can you say war profiteering.

You don't have to rrrrrroll up the rim to figure out whose the winner here.

See:

Timmies

Tim Hortons

P3

Afghanistan



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Monday, November 27, 2006

Your Pension Dollars At Work

As I said here the new P3 model in Canada is not private public partnerships but Public Pension Partnerships that bailout the Government. But it is still taxpayers money at work.

Water is the new oil: CIBC


In Canada, there are few ways for investors to directly invest in H2O. However, the Canada Pension Plan Investment Board recently launched a bid for a British water utility.

The colossal cost of fixing crumbling water infrastructure in the developed world has opened the door to government privatization.

Water delivery systems in the industrial world are in “dire need” of repair, says a report released Monday by CIBC World Markets Inc. At least one-fifth of America's municipal wastewater treatment facilities do not comply with federal regulations and in some U.S. cities, more than half of the water headed to consumers is lost along the way.

CIBC economist Benjamin Tal, author of the “Tapping into Water” report, estimates it will take “hundreds of billions of dollars” to fix dated water infrastructure in North America and Europe.

Federal governments are not rushing to fix the infrastructure and municipalities lack the means to do so. “As a result, governments are now much more open to the notion of privatizing their water infrastructure which, in turn, is providing a substantial boost to the private water industry,” Mr. Tal said.


See

P3

CPP





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Saturday, February 18, 2006

How Many Audits Does It Take?

The new Minister of State Security Stockwell Day has announced that he wants yet another audit of the Firearms Registry.

Not satisfied with the previous audits; the first were internal audits done in 2000-2001, followed by the damning Auditor General audit in 2002 then followed by another damning independent audit in 2003 by Raymond V. Hession and KPMG

So how many audits do ya need Stockwell to tell you that the cost overruns were caused by Privatization and Contracting Out of services. Stockwell like Vic Toews, Minister of Justice,cannot believe the facts that are as clear as the noses on their faces. Contracting Out and Privatization created the cost over-runs:

Canada’s Billion Dollar P3 Boondoggle

What the Liberals and Conservatives Don’t Want You To Know

The real story behind the cost overruns at the Canadian Firearms Centre

"Just read your piece on the firearms P3 – quite a revelation. I am amazed we have never heard this before – congratulations for bringing it to light."
Murray Dobbin, author of Paul Martin Canada's CEO
Once again the Tory ideology that privatization, contracting out and Public Private Partnerships P3's are the solution to reducing government spending and costs falls flat on its face in the light of the facts of the Firearms Registry cost over runs. They just can't beleive it to be true. All the new audit will show is what the Auditor General and Hessions KPMG audit did and I reported in the article above.


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Friday, April 27, 2007

Minister of P3


Greg Weston of the Sun chain has an excellent piece exposing the insider deals in Public Works to sell off government buildings, which began under the Liberals, and then lease them back. Which makes about as much sense as selling your house and then paying rent.


It was only a matter of time.

The moment Stephen Harper appointed a corporate investment banker to be public works minister in charge of government contracting with thousands of Canadian corporations, political controversy was sure to follow.

The inevitable storm engulfed senator-minister Michael Fortier this past week after a company publicly complained about losing a $400-million contract bid to one of Fortier's former investment banking clients.

While there is no evidence of fiddling by Fortier or his team, the opposition parties are justifiably asking that the newly created Integrity Office review the contract award, if only to lift all suspicion from the minister and reassure the public.

For all the same reasons of probity and protecting reputations, maybe the ethics folks might also want to review what could be the largest government real estate deal in decades.

Fortier announced in March that public works is ready to sell $1.5 billion of federal office buildings that the government would then lease back for the next 25 years.

$6M IN COMMISSIONS

Last September, Fortier's department awarded the contract for the real estate sell-off to the investment banking arms of the Royal Bank (RBC) and the Bank of Montreal (BMO), a deal expected to generate at least $6 million in commissions.

The key player in BMO's winning bid, for instance, was Rick Byers, managing director of the firm's government investment banking group.

Byers is highly qualified for the job as an expert in government privatizations, having had lead roles in projects such as the $1.5-billion spinoff of the air traffic control services at Canadian airports.

But Byers also happens to have been a prominent Conservative party fundraiser and organizer who has twice run for a federal seat under the Tory banner in the Ontario riding of Oakville, and is a candidate for the Ontario PCs in the provincial election this fall.

Byers' political ties to the current public works minister go back to the 1998 Conservative leadership race when Fortier ran against Joe Clark and lost by a mile.

In 2003, the two investment bankers backed Scott Brison's bid for the PC leadership -- Byers was the campaign chairman for Ontario, Fortier assumed the same role for Quebec.

One of Brison's chief fundraisers was another highly respected investment banker named Michael Norris, then head of RBC's investment banking operations and now the firm's deputy chairman.

It all begins with the appointment of investment Banker Michael Fortier to the Senate as the unelected Minister of Public Works and goes downhill from there.

The Public Works changes now throw into disarray the procurement-reform process, which is intended to generate savings of $2.5-billion over five years. The savings have already been built into the government's books and Prime Minister Stephen Harper mandated Mr. Fortier to find the savings.

But before more reforms are made, the minister wants answers on two issues raised by The Globe and Mail this week, a senior Public Works official said: a trip to London by two high-ranking advisers that was marred by missed and cancelled meetings; and a consulting contract with A.T. Kearney Ltd. that was supposed to be worth $15-million over four years but has cost $24-million in only nine months.

“The minister has asked for a full report on the A.T. Kearney contract to see whether we obtained value for money,” the official said. “Why did we spend more in one year than what we had planned over four years? There was obviously a management problem.”

The contract was awarded in November by the previous Liberal government, but most of the cost increases occurred after the Conservatives came to power this year.


The Liberals began the overhaul at Public Works, an initiative known as The Way Forward, which is supposed to save $3.5 billion over five years. The Harper government endorsed the reforms, but Mr. Fortier took a different course from the Liberals, who considered selling much of the government's real estate holdings, and issued a tender call for advisers on how to manage the portfolio. That contract will be awarded soon.

The Tories continued the course started by the Liberals for procurement reform until Mr. Fortier faced a near revolt from small suppliers over a tender call for temporary help agencies that called for the use of reverse auctions.



It turns out that this is another case of the Government commissioning a study that it does not want to share. The study being done by party pals of the government,and Minister Fortier, who would benefit from the sale and leasing of these buildings. It replaces the previous Liberal contract with A.T. Kearny and the Tipple Rotor non report.

The two consultants hired by Fortier will profit from this for their employers, two of Canada's biggest banks, the lucrative fees they make kick backs to stalwart Conservative political operatives.

Public Works Minister Michael Fortier rejected demands from opposition members yesterday to refer a controversial plan to sell off nine federal buildings to the newly created Integrity Office.

Fortier also refused to release a report from two banks giving advice on the prospective sale and lease-back of the buildings, estimated to be worth $1.5 billion.

Those two banks would also earn a commission on the future sale of the federal buildings, Fortier confirmed to a Commons committee yesterday.

Officials would not disclose the details of that commission.


Like the guys who went to England to learn from New Labours P3 failures paid for secretly by the PMO, were hired as government consultants. And thanks to the power of the PMO, their report paid for by taxpayers also remains secret.

Hon. Michael Fortier: Let's deal with the gentlemen and the visit
to London. I had a report from the deputy on what the business trip
was about, and I'll let him talk about this in a second.
With respect to A.T. Kearney, there is no report. They were hired,
as you pointed out earlier, more than 18 months ago through a fair
RFP open process. Big numbers. I totally agree with you. Where I
come from, $19,000 is a lot of money. The original contract was for
$19 million with the ability to go to $24 million. The media reports
talk about the contract being seven or eight or nine or ten times what
it was supposed to be. The reality is it was signed by the former
minister, and the number that he authorized is the number that was
spent.

Ms. Peggy Nash: Excuse me, Mr. Minister, you say there was no
written report that came out of this $24 million contract. What did
come out of it?

Hon. Michael Fortier: They were advising the department in
three or four specific areas. One was to actually look at these savings
and see how they could be generated. They were looking at $20
billion of procurement through 50 to 60 departments, and they were
helping the department literally collect data and strategize on the
reform itself.

The reform is not just about saving money. We've talked about it.
It's about proceeding with procurement in a smarter and more
transparent fashion.

Ms. Peggy Nash: When there were reports of the two
representatives who spent a week in London and cancelled
meetings—I don't know if they actually succeeded in meeting with
anyone there—the media reported that you had asked for a report.
Did that happen?

Hon. Michael Fortier: I spoke with the deputy. The deputy
reported to me on what the situation was.


This is not "New", the Harper Government of Canada really is becoming all too tiresome in its predictability for autarchy and secrecy.

During an appearance before the Standing Committee on Government Operations and Estimates, the Minister refused repeated requests by opposition Members of Parliament for an investigation into this apparent conflict of interest. The review would be conducted by the Public Service Integrity Office, an office created by the minority Conservative government as one of its new "accountability" measures.

"This government talks a good game about accountability, but they apparently forgot to send the memo to their Senator-Minister, who apparently believes he is above oversight," said Mr. Rodriguez.

Kathryn May, The Ottawa Citizen

Published: Wednesday, April 25, 2007

Public Works Minister Michael Fortier says he won't ask the integrity office to investigate complaints that he was in a conflict of interest over the awarding of a $400-million technology contract because he has never been involved in the selection of bidders since he took the job.

"I have not directly or indirectly been involved in the selection and awarding of any contract, not just this contract, since I was sworn in as minister of public works in February 2006," he told the Commons government operations committee yesterday.

Last week, Ottawa-based TPG Technology Consulting raised concerns that Mr. Fortier may be in a conflict of interest over a $400-million contract it lost to competing bidder CGI Group Inc., for which Mr. Fortier worked during his previous career as an investment banker. TPG alleges the bidding process was stacked in favour of CGI, even though it offered the lowest price.


TPG Concerned that Minister Fortier Doesn't Support an Investigation into Suspicious Contract

    OTTAWA, April 25 /CNW Telbec/ - TPG Technology Consulting Ltd.'s
president, Mr. Don Powell, is concerned that a number of recent statements
made by Mr. Michael Fortier, Minister of Public Works and Government Services
Canada (PWGSC), suggest the Minister is turning a blind eye to the
circumstances surrounding the pending award of a $400 million contract for
technical services. Otherwise, his department would be more willing to
investigate the potential conflicts of interests and possible breaches of
protocol surrounding this process.
"The Minister keeps stating that nothing went wrong and that he doesn't
want an inquiry into the process, but an inquiry would give other individuals
the opportunity to come forward and state once and for all what happened,"
said Mr. Powell.
"We thought this new government would welcome whistle-blowers and be
ready to investigate their claims to ensure the fairness and transparency of
the process, but the opposite seems to be happening!" Mr. Powell said.
"How can they say there's nothing wrong without even looking at what we
have? We thought the 'shoot, shovel and shut up policy' wouldn't be part of
the Conservative's agenda."
Mr. Powell said PWGSC has not seen the evidence obtained by TPG, but has
worked hard to discredit TPG's concerns.

Where is the accountability?

Mr. Powell states that he is ready to divulge information to an
independent body that will offer protection to involved individuals so that
they can feel safe in coming forward to share their concerns about this
process.
An independent inquiry is the only way to determine whether this contract
process was conducted in a fair, open and transparent manner.




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Friday, October 27, 2006

Public Pension Parnerships


David Dodge , Governor of the Bank of Canada has a new definition for P3's, Public Private Partnerships, well actually he has said this many times before. His definition of P3's for investment purposes is Public Pension Partnerships. That is he wants to see government access workers pension funds to pay for infrastructure.


On the long-term structural issues facing Ontario, Dodge said it was critical the province improve efficiency and productivity by investing in infrastructure and human capital.

He threw his support behind public-private partnerships as way for Ontario to dig its way out of an infrastructure crunch.

''There is evidence from other countries that public-private partnerships can both increase the efficiency of investments and support their financing,'' Dodge said.

''Now is the right time to encourage partnerships between the government of Ontario and private providers, given the climate of low nominal interest rates and the presence of large pension funds that searching for these kinds of investment opportunities.''


As I have said here before the liquidity of institutional pension funds, such as the Canada Pension Plan, Ontario Teachers Fund, the largest such source of capital in Canada, and OMERS, as well as the building trades pension funds are not private but actually another form of public funding. In otherwords Public Private is a misnomer, it should be called Public Pension Partnerships. The working class again funds itself, through low wages, taxes and then finally with our pensions.

Private capital on the other hand wants to make its profits faster so it will not invest in infrastructure. Instead it turns to creating tax shelters such as Income Trusts. So the State turns to social capital for its financing instead, as do businesses that are in need of restructuring but want to avoid a hedge fund takeover, which inevitabley ends when they are cannibalized and sold off.

CPP to assume active role with $5-billion fund

The relationship portfolio will eventually consist of about a half-dozen companies and be part of the $57-billion in stocks run by Donald Raymond, CPP's senior vice-president for public market investments. Mr. Raymond is a former Canadian air force pilot who joined the money manager in 2001 from Goldman Sachs & Co. The new head of relationship investing is expected to receive a pay package similar to the $864,000 that Mr. Raymond was awarded last year.

The move to activism — CPP executives prefer to call it “pro-active engagement” — takes the CPP fund down a path blazed by many U.S. public sector funds and the Ontario Teachers Pension Plan. The $96-billion Teachers fund has been making such investments for the past 15 years, using in-house expertise to earn superior long-term returns.

Teachers now has between $3-billion and $4-billion of its money committed to this area, said Brian Gibson, a senior vice-president at the pension fund.

Value investors typically target companies they feel are undervalued, and wait for the price to appreciate. Activist investors target much the same companies, but once they understand what they believe to be reason for the underperformance, they work on a plan to correct it.

Pension funds that currently are complaining that they have no shareholder say in companies they invest in turn deny their own investors, you and me, any say in their internal affairs and investment policies. Pot, kettle, black.

The powerful Ontario Teachers Pension Plan is asking Goldcorp Inc. to give shareholders a vote on its $6.7-billion (U.S.) takeover of Glamis Gold Ltd., giving credence to a court challenge by the company's founder and largest shareholder.

As Robert McEwen's request for a court order imposing a Goldcorp shareholder vote was being heard in Ontario Superior Court, Teachers executives were meeting with the company's chief executive officer, Ian Telfer, just a few blocks away.

The pension plan, which owned about 2.3 million Goldcorp shares or about half a per cent of the company's outstanding float at year end, said the transaction's significant share dilution is well beyond the level where shareholder input should be sought. “It's hard to imagine how you can issue 67 per cent of your shares and say nothing has changed,” said Teachers senior vice-president, Brian Gibson, in an interview. “That's pretty significant and we believe shareholders should be consulted,” he added.

What we need is a socail policy on public pensions that allows those of us who are the investors and owners of these funds to have a say in how and where they invest.

Capital and Social Europe
Robin Blackburn, NLR 34, July-August 2005, pp. 87-112
The social funds would also be as much about producing wealth as distributing it. In a continent where stock exchanges are already of greatly increased importance, the social funds could help to protect productive enterprises from ‘financialization’, promote socially responsible business objectives and assert a degree of popular control over the accumulation process. The network of pension funds would have significant power in corporate affairs, both because of its shares and its investment policies. The fund network could develop its own cadre of financial specialists and would have reason to assist the tax authorities in monitoring and enforcing fiscal regulations.


See:

Social Insecurity The Phony Pension Crisis

Pension Plunder

Is Delphi the Oracle of things to come?

Labour Is Capital

Pension Free China

Kids Are Commodities

Workers vs Worker

Air Canada Profits From Bankruptcy




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Thursday, October 15, 2009

Forward to the Past

Well excuse me if I am not surprised that Steady Eddie Alberta's CEO produced a TV show last night that announced nothing new. In fact while some folks bemoan the premier for not being Ralph Klein, including King Ralph his-self, Steady Eddie is living up to his name.

In fact he is the ghost of the Tories Past, the actions of his government are just a rehash of Klein's fiscal renovation, of the 1990's. The government is cutting hospital beds and freezing hiring of nurses and doctors, just as Klein did. The are cutting back funding to schools, just as Klein did. They are cutting funding to post secondary institutions just as Klein did. They are calling for a wage freeze for two years for all public sector workers just as Klein did. The debt and deficit hysteria that launched the Klein regime has returned like Marley's ghost to haunt the Alberta Government. Having no plan Steady Eddie returns to the past to find solutions to the Tories Made In Alberta Recession.

Blaming the economic crash of last year for Alberta's current deficit is of course par for the course, all governments have used the crash to explain away their economic mistakes. But in Alberta that crash should have been expected, since we have experienced boom and busts before, and those who had like former Premier Peter Lougheed warned that the Alberta Government led by his old party, had no plan to deal with the boom. And of course it had no
plan to deal with a crash.

The failure to invest the Heritage Trust fund or to fund it adequately led to the current deficit. And yet those in charge of investing both the Trust fund and the new AIMCO investment fund (made up of your and my public sector pension funds) lost the province billions, that now make up part of the current deficit. It was this investment failure that has cost the province much including outrageous buy outs and bonuses to these same fund managers.

The province's Heritage Savings Trust Fund lost the $3 billion between March 2008 and March 2009 in the economic downturn, and currently sits at $14.3 billion. The record loss sent Alberta into a deficit for the first time in 15 years. It was the biggest loss in the fund's 33-year history.

two AIMCo executives earned a combination of more than $5 million last year even as the funds they managed -- including the Heritage Savings Trust Fund -- lost more than $7 billion.

The collapse of oil and gas prices of course added to the deficit but not to the degree that the bad investments of our surpluses did. In fact the decline in natural gas production in the province began back in 2001 and is something that could be planned for, if you had a government that was not adverse to planning.

The problem, however, is that production in the Western Canadian Sedimentary Basin (WCSB) is declining. Production peaked in 2001; the vast majority of the country's natural gas is produced in the WCSB. According to Canada's National Energy Board (NEB), Canada's marketable production peaked around 17 Bcf/day in 2001.

Sadly, no amount of drilling is going to reverse the decline. Production declined in 2005, despite having a record number of well completions in the WSCB. Take a look for yourself:

Western Sedimentary Basin Well Completions

If we take a look back, 2005 should have been a huge year for Canadian natural gas. That year, we saw the most active Atlantic hurricane season in recorded history. Fifteen hurricanes blew past us. Five became Category 4 hurricanes and four reached Category 5, including Katrina and Wilma.

That same year, Canada imported 3.7 Tcf of natural gas to the U.S. However, Canadian production of marketable natural gas fell 1.7%, compared to 2001 levels. According to NEB projections for 2009, natural gas production will sit at 5.5 Tcf — 12% lower than in 2001.




Add to that the expansion of infrastructure projects, that under Klein had been halted, as labour costs increased during the boom and you have another reason for the deficit.

Finally we have the creation of Hospital Boards, which were to have been publicly elected and were for one term and then when to0 many liberals and dippers were elected the boards were fired by Klein and replaced with Tory hacks. Steady Eddie's first act as Premier was to follow in Klein's footsteps, firing the regional boards and forming a super board, the cost of which was again payouts resulting in the new super board having a half billion dollar deficit.


And while Steady Eddie announced a wage freeze for senior government managers it means little when in fact these same managers racked in bonuses worth $6.7 million last year. And we suspect that even if he follows through with MLA and cabinet salary freezes its after the cabinet gave itself and the Premier a 34% increase last year.

The other reason for the deficit is that Alberta is business friendly. The cost of doing business in this province is nil, zilch, nada. The working class taxpayers in Alberta shoulder the burden of business costs. And thanks to the generous tax breaks to business the burden of the deficit is shouldered by you and me, and the solution that some are suggesting is the dreaded of all taxes the sales tax.

The Progressive Conservative government, in power since 1971, has long had a hands-off approach to business. Foreign investors have long been attracted by the lack of sales, payroll or capital taxes, low income taxes and competitive corporate taxes, at 29 per cent and dropping to 25 per cent by 2012. Despite a current deficit, overall net direct and indirect debt is low, totalling C$1bn or 0.3 per cent of GDP on March 31, according to a recent Moody’s report that gave Alberta a triple-A debt rating.

Like the mythical debt and deficit crisis of the Klein years this too is a short term recession, with a temporary deficit. And like then the deficit will be paid off by cutting public sector funding and freezing wages rather than taxing the capitalists. Nothing new here just as there is nothing new with the Tired Old Tories still in power.



SEE:

Your Pension Plan At Work

P3

Your Pension Dollars At Work

P3= Public Pension Partnerships



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