Category Archives: Opinion

BC’s Elusive LNG Tax

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http://qwlaw.ca/qw-law-blog      May 11, 2014

The BC government has one devil of a problem on its hands.

Last year, it won re-election largely on the basis of promises of enormous wealth and revenues flowing from the birth of a massive Liquefied Natural Gas export industry. Billions of dollars would flow into the treasury, the provincial debt would vaporize, and we would all be awash in jobs, jobs, jobs.

Mt Hayes LNG

FortisBC Energy Inc.’s LNG plant at Mt. Hayes, serving BC utility customers – and a target for the upcoming BC LNG Revenue Tax

But has something gone wrong? Last spring, the government announced that by autumn it would unveil its taxation scheme to extract this revenue from an LNG export industry. The months passed, and the taxation plan was postponed to the winter. In the February budget, it said the plan would be made public next fall.

Why the delay?

Because figuring out how to extract significant provincial revenue out of LNG exports is a very difficult problem – and this is on top of the uncertain prospects for the LNG industry to happen at all, or on the kind of scale the Premier heralded on the campaign trail.

There is no obvious point in the process for a provincial government to insert itself and extract a share of the money.

The gas starts out in the ground. When it is extracted, there is no way of telling which molecules are destined for export and which will be burned to keep homes warm in Prince George or Surrey.

The gas is then refined. Same problem here – there is no way to sort out which gas is headed where.

Then it’s shipped by pipe to the coast, where it is super-cooled and condensed, loaded onto tankers, and off it goes to Korea or other points west. There it is sold for perhaps double or more the price it was worth on our side of the Pacific Ocean.

So imagine you are a provincial government and you want to make billions of dollars out of this activity. Here’s your great big problem: the province cannot impose an export duty on the gas, whether it’s called a duty or disguised as something else.

They already charge a tax called a “royalty” on the gas when it is sucked out of the ground. The only way to get a higher rate of revenue at this stage is to increase the royalty on all the gas at the point of extraction. Some of that royalty will come out of the LNG trade, but the rest will come out of BC homes and businesses who use natural gas for heating and other purposes.

They can’t charge a tax at the dock in Japan when the gas is offloaded into the Asian market.

Somewhere in between? What happens “in between” is the refinery, the pipeline to the Coast, the liquefaction plant, and the tanker ship terminal. If the gas belongs to the same company throughout these steps, there are no financial transactions to tax. It’s just the company’s gas being moved along through its system.

What Victoria has hit upon is to tax the revenue from the liquefaction process. Sounds fine, but there’s one problem – what if there is no revenue flowing from that step? Is Shell paying itself at the LNG plant for the gas it delivered there in its pipeline? Not likely.

So what they will need to do is invent some sort of make-believe commercial transaction at the point of liquefaction. Calculate some notional value-added by that process and tax it. I can hear the wheels spinning in the heads of the companies’ tax lawyers about ways to structure the whole arrangement to minimize the tax hit.

And there’s yet another problem – if the government singles out LNG for export, they are probably guilty of imposing an unconstitutional tax. In its budget announcements this winter, the government said that the LNG tax would apply whether the gas was for export or for domestic use. They really have no choice, if they want an LNG tax at all (see above – disguised export duties).

Did you know that there are already two LNG plants in BC? One is on Tilbury Island in the Fraser Delta, and the other is on Vancouver Island at Mount Hayes. They belong to FortisBC Energy (aka BC Gas or Terasen). Those facilities are used for the utility’s BC customers.  They are LNGs for domestic use and therefore would be caught by the new tax.

So the supreme irony is that it is possible that the LNG tax will only be paid by BC residents. That’s because it is not at all certain that we will see an LNG export industry in BC. If we do, it is highly unlikely to be on anywhere near the scale the Premier was trumpeting during the election.

But more about that in a future article.

Your Boss Is a Dick (A Glossary of Labor Terms, Translated)

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How to win arguments and lose friends.

January 3, 2014 | http://www.alternet.org 

This article originally appeared on Truthdig, and is reprinted here with their permission.

* * *

Editor’s note: In light of recent tensions between progressives and their allies in the union movement, comedian and former labor organizer Nato Green was moved to write this humorous glossary. Please don’t take it literally.

Whenever there’s a big labor news story, I’m deluged with calls from friends who, like most Americans, are vaguely sympathetic to unions but don’t know much about them. Corporate media reliably provide the hard-hitting investigative journalism one expects from a Bazooka Joe gum wrapper. Bad enough that there are so few union members anymore that assigning a reporter to cover labor beefs makes as much sense as putting someone on the Coptic beat. And unions don’t help themselves win over the public, what with their East German approach to public relations and earnest commitment to matching T-shirts.

For example, during the 2013 Bay Area Rapid Transit strikes many liberals I know said, “I don’t have a pension or good health insurance! Why should they?” To which I would reply, “You seem pretty mad about black people having good jobs.” This is an excellent way to win an argument while losing a friend.

So to help out my friends in organized labor, here is a glossary of key union terms, translated for everyone else:

ARBITRATION: When labor and management can’t agree, the parties may submit the disputed matter to an arbitrator. The arbitrator hears both sides and issues a binding decision. Arbitrators are former lawyers who seek employment by appearing impartial to two groups of people who hate each other’s guts. They love the phrase “split the baby,” which is exactly as gross as it sounds.

BOSS: Guy at your job who doesn’t care about you. Only cares about power and money. Person with the authority to hire or fire you. Wants you to “feel like family” and dance to his favorite Van Morrison songs at the holiday party, but “will see” if you can have a raise this year. (See GOOD BOSS.)

BUILDING TRADES: Construction unions of burly men who like to drink and look a man in the eye. They’d build concentration camps if the Nazis would agree to hire their guys.

CARD CHECK: The easy way for nonunion workers to join a union. Workers just sign a union card saying they want a union. When a majority of workers sign union cards, the union presents the cards to an impartial third party, like a street juggler, who verifies that only living current employees signed. Fewer ways for the boss to hassle workers out of unionizing, which is why bosses act like card check gives them avian flu.

CONTRACT: Collectively bargained, legally enforceable, democratically ratified agreement covering wages, benefits and working conditions. At best, the union guarantees a defined period of time (usually three to five years) of no strikes in exchange for a good deal. At worst, the noble pursuit of workplace democracy is smothered by bureaucrats and lawyers like rancid mushroom gravy on apple pie.

COOLING-OFF PERIOD: Something politicians call for to act like they’re helping without having to take a risky position.

DEFINED-BENEFIT PENSION: The good kind of pension plan. This is a retirement plan in which you are guaranteed a specific amount of pay upon retirement, according to a formula 27 people understand. These are regulated and guaranteed. Because they offer workers enough security to rise above being desperate and grateful for an occasional “cake day,” bosses hate them.

DEFINED-CONTRIBUTION PENSION: This is the 401(k)-type plan, in which the boss contributes something, the workers contribute something, and then the employees are free to gamble in the stock market with their retirement just like teeny tiny Warren Buffetts. If they happen to retire in a year when their entire nest egg is swallowed in a rapacious Ponzi scheme stock bubble, that’s the magic of the market. Savor it.

Georgetti: The Tories Attack on the Middle Class Should Worry You

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Ken GeorgettiKen Georgetti    President, Canadian Labour Congress

12/04/2013   http://www.huffingtonpost.ca

The Conservative government is engaged in a campaign to distract their supporters from a series of Senate scandals and cover ups. The Conservative fundraising machine believes that if it feeds its base a constant diet of someone to dislike, the donation cheques will keep rolling in. Workers and their unions are their current targets with a long list of legislation designed to keep their base happy.

The Conservative government’s recent volleys against workers and their unions will only serve to undercut the well-being and security of middle-class families in Canada if they succeed in pushing through their anti-union legislation. The Globe and Mail said as much in a recent series of articles on growing inequality in Canada — “declining unionization has contributed to wage inequality.”

Canada’s labour movement is not just about decent jobs, it’s about a better life for everyone. Unions have worked to protect good jobs, make workplaces safer, fought for paid vacation time, public health insurance and the Canada Pension Plan. When union members stand up for fairness everyone benefits — whether you belong to a union or not.

Canadians will see through the government’s attempts to divide people against one another. At one end of the legislative spectrum, the government uses giant omnibus bills to throw everything but the kitchen sink into one piece of legislation. The current budget bill runs to 308 pages and in the fine print it makes sudden and dramatic changes to the Canada Labour Code. One of those changes would place workers’ lives at risk by eroding their right to refuse dangerous work.

Other amendments to federal labour laws would erode workers’ constitutional right to bargain collectively by letting the government unilaterally, without negotiation, change the rules for bargaining with their employees. To add insult to injury, witnesses to the parliamentary committee studying the bill who would speak out against the changes were deliberately scheduled to testify after the deadline for the committee to make amendments passed.

What is the government really trying to fix here? We know that well over 99 per cent of all collectively bargained contracts in Canada result in an agreement rather than a strike or lockout. There was no consultation with any of the parties affected by this proposed legislation, and changing the rules without consultation and negotiation is simply heavy-handed and unfair. Given the Supreme Court of Canada will soon rule on very similar legislation introduced by the Saskatchewan government, the ideological cousins of this government, it’s also premature.

At the other end of the legislative spectrum, the Prime Minister’s Office (PMO) is offending parliamentary tradition by using its influence to introduce Private Member’s Bills and to force their passage. That is what happened with Bill C-377, an unconstitutional piece of legislation that will force labour organizations (but no one else) to undertake costly and time consuming reporting of even the most minute of financial transactions.

Bill C-377 was supposedly the initiative of backbench Conservative MP Russ Hiebert but we know that special interest groups met frequently with the PMO, including the Prime Minister’s Chief of Staff Nigel Wright, and the PMO exerted pressure in order for the bill to pass.

The senate found Bill C-377 to be so offensive that it was sent back to the House of Commons in June with numerous amendments. But then the Prime Minister shut down Parliament and Bill C-377 is now going to be sent to the senate all over again. Bill C-377 is ideologically-motivated and aimed at wasting union members’ money and it is not needed. Our members already have access to financial information about the unions to which they belong.

Bill C-525, another Private Member’s Bill put forward by a Conservative MP, would make it nearly impossible for workers in the federally-regulated sector to join a union. The bill would consider workers who don’t bother to vote in a certification vote as casting “no” ballots on having a union. That’s not democratic — giving those who don’t vote control over those who do. If those rules applied to electing MPs, Parliament would be empty. One set of rules for Conservatives and a different set for workers — that’s unfair.

Finally, the recent Conservative Party convention in Calgary passed a number of aggressively anti-worker resolutions. One of them would allow some workers to stop paying union dues but still receive all the benefits that the union negotiates – all at the expense of their coworkers who do pay their dues. Leave it to ethically-challenged Conservatives, counselling people that it’s okay to dine and dash at a restaurant while leaving others at your table to pay the bill. That’s unfair and it’s a recipe for conflict and disruption in the workplace.

This government puts its extreme ideology ahead of all other considerations, but Canadians see these bullying tactics for what they are. The CLC and its affiliates ran a television advertising campaign during October and November 2013. We talked directly to Canadians about the positive role that the labour movement plays in our society. The response to our campaign has been overwhelmingly positive from both union members and the public at large. That response and our polling shows that we are on the side of the vast majority of Canadians. They will support a labour movement that works in the interest of fairness for everyone.

Ken Georgetti is president of the 3.3 million member Canadian Labour Congress.

Overtime Issue And The REAL Truth….Just Saying….

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December 1, 2013 Just-saying

Once again I have come across some non verbal diarrhea where someone has spewed babble from the bowels of his head, instead of his mouth, with out any regard for  the truth  just to incite discord, divisiveness , and erroneous use, and disrespect of the word “understanding”. Whether intended or not.

What is more disconcerting is that the Province newspaper published it, and are just as responsible for allowing for the piece to be published and circulated without regard to facts but considering our newspapers are just as polluted with filth, disregard to truth, as our streets, legislatures and of course parliament are, I should not be surprised……Just Saying…..

Anywhoos….take a read for yourself at both the letter to the editor and the response.

Look at the contracts

I am responding to the article about nurses’ overtime bills with deep concern about the reckless spending of our health budgets.

You should take a hard look at the union contracts and I urge you to disclose to the public how the nurses schedules are structured and many hours of straight time are worked before overtime is paid. You will be shocked at what you find out.

The union has negotiated a pretty lucrative contract that pays as much overtime as straight time.

Tim Nemeth, Chilliwack

We’re getting better

As the largest health authority in B.C., with more than 22,000 employees and serving more than a third of British Columbians, Fraser Health takes the issue of overtime seriously. Our concern is not only the cost of overtime, but also for the safety and overall well-being of our staff.

Your article did not note that we have reduced overtime. In the last three months, our overtime costs dropped by $1.2 million, or 17 per cent. We are committed to ensuring employees are working in a safe environment and that we facilitate healthy work schedules.

Additionally, we have an active recruitment strategy. Over the last three years, we have hired more than 1,000 nurses and invested more than $10 million in specialty education for our nurses.

Given the complexity and unpredictable nature of health care and the emergency services we provide, there will always be overtime, but we are committed to reducing this to ensure our staff have appropriate work-life balance and that we are able to better manage costs.

Vivian Giglio, vice president, clinical operations, Fraser Health

The right of Freedom of Speech comes with a high price at times. Good thing there are people that strive on presenting, and representing the facts, and the truth, even though it may be easier to lie, misrepresent, mislead, for self-serving gain, whatever that may be.

The Greatest Challenge Facing The Labour Movement And What Skills Are Essential for Today’s Leaders….Just Saying….

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December 1, 2013    Andrew ChernoffJust-saying

The greatest challenge facing the labour movement is re-establishing itself as a valid and vital movement in the lives of working people, politics and society in the 21rst century.

The fights and struggles that the labour movement had in the 20th century, continue. The gains that the labour movement achieved, are being threatened, challenging unionism and the strength of the union movement

The labour movement needs to rediscover and identify with the roots of its movement—-what inspired the rise of unions in Canada; its impact on Canadian politics; and its influence on society over the last one hundred years.

For example, advocating for justice, health and safety for workers.

Being a voice for decent wages; the 8-hour work day/40 hour work week; decent working conditions.

Speaking up politically as stewards of Canada’s resources and the land,; promoting laws and regulations that not only advance, but protect, our standard of life for all Canadians, now and for the future.

Politically, the 20th century saw the emergence of the federal New Democratic Party which the labour movement helped found.

The impact of the labour movement on Canadian society was no more apparent than the realization of Universal Health Care for all Canadians.

In short, the labour movement needs to embrace the ideals and passions, the inspiration, that got labour and Canadians in general, engaged in the late 19th century and early 20th century, in combating its greatest challenge in this century: its reestablishment as a valid and vital movement in the lives of Canadians, society and politics.

No more less important, and imperative for the labour movement, are our leaders; specifically, our leaders possessing and utilizing skills that are essential in taking on the great challenge facing the labour movement.

For example:

Being well versed in parliamentary procedure and a good public speaker are necessary skills when advancing the agenda of the labour movement whether it is in a union meeting, on the shop floor or at a community hall meeting on a local issue important to all. To articulate simply, clearly and effectively, in a way that instills faith, confidence and engages the listener, creates conversation and participation, and helps to maintain order.

Being a good listener. It is essential in determining what is working, what isn’t working; how it could be made better. If our leaders are too busy speaking, then they are not listening and endeavouring to find out what someone else has to say and contribute to the conversation.

Finally, engagement. The skill of being able to engage those in the union movement in a personal and real way that makes a difference for them; that makes them feel empowered and encouraged that they can make a difference, not just as part of the labour movement but as a citizen in their community, their province and in their country.