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» babble   » current events   » national news   » Privatise hydro, sell assets and "outsource" jobs CAW economist recommends

   
Author Topic: Privatise hydro, sell assets and "outsource" jobs CAW economist recommends
a lonely worker
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posted 21 February 2008 12:54 PM      Profile for a lonely worker     Send New Private Message      Edit/Delete Post
Further proof of the CAW leadership's total abandonment of any working class principles:

quote:
Hundreds of millions in savings can be found within the cash-strapped city's budget, including selling off key assets, according to a report to be released today by an expert panel examining Toronto's finances.

The blue-ribbon panel led by real estate executive Blair Hutcheson was asked by Mayor David Miller last October to look at the city's books and identify potential savings.

According to a source, it makes sweeping recommendations on finances as well as governance changes at city hall.

They include:

Consider selling off Toronto Hydro to reduce the city's growing debt load.

Create a super-agency to manage the city's huge real estate portfolio as a way to maximize returns.

When Miller announced the six-member, all-volunteer panel on the eve of a crucial vote to introduce a new city land transfer tax and vehicle registration tax, he said the city was run professionally and competently. He conceded, though, "there may be room for further improvements and efficiencies."

Some of the suggestions will not necessarily set well with the mayor, so it will be interesting to see what recommendations are adopted. Members of council's right wing have often questioned whether the city was doing enough to find savings.

Deputy Mayor Joe Pantalone, who said he had not seen the report, said yesterday the city will certainly listen to calls for more private sector involvement in city services.

But he said it would be highly unlikely the city would sell off valuable assets such as Toronto Hydro or the Toronto Parking Authority.

"The panel was chosen and the mayor was serious about having this group look at what we do," Pantalone told the Star. "For us not to look seriously at what they recommend would be inconceivable."

Other panel members include Larry Tanenbaum of Maple Leaf Sports and Entertainment, CAW economist Jim Stanford and former York University president Lorna Marsden.

Toronto Hydro generates about $106 million a year for the city; the parking authority $30 million


Big changes urged at City Hall

quote:

Here's another article:

quote:
The report released this morning by the six-member panel recommends:

# Selling off some of the city’s estimated $18 billion in real estate assets to help slash its debt load;
# Giving pay hikes to members of city council’s powerful executive committee.

The report notes than 90 per cent of city jobs are unionized and represent about one-half the city’s budget. That leaves little room for flexibility, but panelists said the city could do a better job at the bargaining table and improve relations with workers to help reduce the burden on taxpayers.

Panellists said the city should be able to find $50 million in efficiencies this year and $150 million per year in subsequent years and that politicians need to “get a grip” on the 119 agencies, boards, commissions and corporations that account for more than 30 per cent of the city’s budget. Those boards and commissions include the TTC, the Toronto Police force and Exhibition Place, as well as the Toronto Zoo and the Toronto Economic Development Corporation.

The panel noted that many of the boards and commissions have separate payroll, accounting and other departments and that there is a “huge opportunity” to save money by consolidating some services.

The panel said the Toronto Parking Authority could be a potential cash cow for the city, possibly by offering long-term leases on its lots.

The city has been trying to reduce the tax burden on commercial and industrial property owners. The panel said that work has to continue in order to bring those taxes in line with other municipalities in the area. That would likely mean higher residential rates for Toronto taxpayers.

There was no major call for contracting out of city services, which would prove hugely contentious for Miller and his union backers. But the report did point out that the city could save money through “outsourcing” and improved procurement policies.

Hutcheson said the city was very forthcoming with information and that panellists were “in unanimous agreement on the full package.”

Councillor Denzil Minnan-Wong, like others of council's right wing, has always insisted there are savings to be found within the budget, including contracting out.

"I think the report’s great. I think they’ve done great work," he told reporters today. "What it does show is there’s a solution here we can look at to put ourselves on good financial footing. There’s a way in which we can deal with our operating shortfall."

He added that he hopes the recommendations are taken seriously and are not put on the shelf to gather dust.

"They’re bold, they’re imaginative and innovative," Minnan-Wong said. "The city should be focusing in on the things it needs to do well. Those things it doesn’t need to be involved with, it shouldn’t be involved with."


Raise taxes, sell land: City report

I wonder when the CAW will change their name to the Corporate Auto Workers?


From: Anywhere that annoys neo-lib tools | Registered: Jul 2005  |  IP: Logged
Uncle John
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posted 21 February 2008 01:06 PM      Profile for Uncle John     Send New Private Message      Edit/Delete Post
If thousands of Internet users can pay £35 each to own a soccer team, why don't we set up something similar for Toronto Hydro, perhaps restricted to Canadians only?

As a utility, it should be available for a low multiple, and we should be able to get a nice dividend. Once bought and paid for, we could hire the City of Toronto to run it for us.


From: Toronto | Registered: Feb 2008  |  IP: Logged
a lonely worker
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posted 21 February 2008 01:39 PM      Profile for a lonely worker     Send New Private Message      Edit/Delete Post
Why do we need to buy something we already own?

This isn't a bankrupt football club, this is a utility that we depend on and all dividends are returned for public services instead of private profit. Something it appears the "socialist" Jim Stanford disagrees with.


From: Anywhere that annoys neo-lib tools | Registered: Jul 2005  |  IP: Logged
Fidel
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posted 21 February 2008 01:40 PM      Profile for Fidel     Send New Private Message      Edit/Delete Post
Didn't they recommend the same thing to third world countries in the 80's?
From: Viva La Revolución | Registered: Apr 2004  |  IP: Logged
a lonely worker
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posted 21 February 2008 01:47 PM      Profile for a lonely worker     Send New Private Message      Edit/Delete Post
Fidel they still do, but this is the first time I've seen the charge lead by a "union" economist.

Aren't we good colonials?


From: Anywhere that annoys neo-lib tools | Registered: Jul 2005  |  IP: Logged
Fidel
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posted 21 February 2008 02:01 PM      Profile for Fidel     Send New Private Message      Edit/Delete Post
I see Jim Stanford mentioned as one of the blue ribbon panel team. I wonder what Stanford himself recommended ?

quote:
Toronto Hydro generates about $106 million a year for the city; the parking authority $30 million. . .

Any suggestion that the city could easily sell off Toronto Hydro for billions probably would be a non-starter with politicians, said David Soknacki, who was budget chief during Miller's first term.

"In financial terms, there is merit. However with respect to the political side of it, it's not going to go anywhere," he said.


The lead on the panel was real estate executive Blair Hutcheson, and so naturally there would be real estate solutions. 99 year real estate leases signed in the 1970's were as ill-conceived as they were undemocratic, like MacBlo-Weyerhauser's 99 year leases on cutting rights for B.C.'s pristine publicly-owned forests due to run out in the near future.


From: Viva La Revolución | Registered: Apr 2004  |  IP: Logged
a lonely worker
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posted 21 February 2008 02:21 PM      Profile for a lonely worker     Send New Private Message      Edit/Delete Post
Stanford agreed with all recommendations. From the second article I linked:

quote:
Hutcheson said the city was very forthcoming with information and that panellists were “in unanimous agreement on the full package.”

From: Anywhere that annoys neo-lib tools | Registered: Jul 2005  |  IP: Logged
Fidel
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posted 21 February 2008 02:50 PM      Profile for Fidel     Send New Private Message      Edit/Delete Post
Okay, now I'm confused.

Toronto Hydro not for sale, says member of fiscal panel

quote:
"Somebody is playing games here," Mr. Stanford said yesterday, refusing to elaborate on any of the panel's other recommendations before the report is released officially. "The panel clearly does not recommend the sale of Toronto Hydro."

The sale, which would be opposed by Toronto Hydro's unions and many on council, was ruled out by the mayor when he convened the blue-ribbon panel last fall, in the midst of a political crisis over his two new taxes.


[quote]


From: Viva La Revolución | Registered: Apr 2004  |  IP: Logged
a lonely worker
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posted 21 February 2008 03:45 PM      Profile for a lonely worker     Send New Private Message      Edit/Delete Post
Interesting. The Star is still keeping its version on their website without retraction.

Even if the privatisation of Hydro is not part of Stanford's recommendations, the others are still indefensible:

- selling city assets or giving them away to corporations through long term leases
- "outsourcing" city work
- raising managerial salaries but none for workers
- raising residential taxes to pay for corporate tax cuts
- creating super agencies to improve "efficiencies" (layoff workers)


As you said earlier Fidel, its a classic IMF formula.


From: Anywhere that annoys neo-lib tools | Registered: Jul 2005  |  IP: Logged
Fidel
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posted 21 February 2008 10:13 PM      Profile for Fidel     Send New Private Message      Edit/Delete Post
Is Toronto’s Mayor Sending His Bolts in the Proper Direction? 2007

quote:
I refer to your recent appearance on CTV in which you pointed out that it will be years before the Toronto subway system is extended to our airport, I note, too, the letter to you of Richard Priestman of Kingston, a leading member of the Committee on Monetary and Economic Reform, sent to you on January 21, 2005, in which he referred to the use of the Bank of Canada, and its provisions under guarantee of either the federal or provincial governments to finance essential investments by municipalities.

Since 1938 when a Liberal government nationalized the Bank of Canada, the interest on such loans, less the overhead expenses for the service of the BoC, would revert to the federal government as dividends. Thus the extension of Toronto’s subway you mentioned would be an investment from which the entire nation, including the federal government would benefit. Not only would it allay the congestion and pollution on our highways, but bring home earlier to their children the two wage-earners that have become necessary to support a family. Moreover, given the long depreciation periods for the tunneling structure in extending the subway, the corresponding investment could claim very long depreciation periods, revealing a far truer and better balance of the books than has appeared for years due to the disregard of the advice of the auditor-general of the federal government



From: Viva La Revolución | Registered: Apr 2004  |  IP: Logged
unionist
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posted 22 February 2008 03:49 AM      Profile for unionist     Send New Private Message      Edit/Delete Post
quote:
Even if the privatisation of Hydro is not part of Stanford's recommendations, the others are still indefensible:

I get it, that you really really don't like Jim Stanford, but why not wait to see the actual report? You only have a few hours to wait. Then you can avoid having to critique recommendations that aren't there.

Like:

quote:
The report on the city's finances, to be released today at the Fairmont Royal York Hotel, was also rumoured to include a recommendation that the province take over the TTC last week, but multiple sources familiar with the report told The Globe this was not the case.

[ 22 February 2008: Message edited by: unionist ]


From: Vote QS! | Registered: Dec 2005  |  IP: Logged
a lonely worker
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posted 22 February 2008 05:40 AM      Profile for a lonely worker     Send New Private Message      Edit/Delete Post
Unionist, the media has been extensively covering this report as of yesterday. It has completely framed Toronto's future in neo-liberal terms.

Here's more details from today's reports:


quote:
The report also calls for the city to study ways to "monetize" - but not necessarily sell off - Toronto Hydro, the Toronto Parking Authority, and the lake-water cooling project Enwave, saying the move could produce up to $3.5-billion to help pay off the city's $2.6-billion debt. Mr. Miller has ruled out selling Toronto Hydro, but suggested yesterday that hiving off part of it, such as its telecommunications arm, might be worth investigating.

The report's warning that the city's unions would have to show restraint did not sit well with Ann Dembinski, president of Local 79 of the Canadian Union of Public Employees, which represents the city's inside workers.

"It's the City of Toronto workers who they expect to bear the brunt of all the wrongdoings of the City of Toronto. We went eight years without a wage increase in the 1990s," Ms. Dembinski said. "...We will not be going without a wage increase."

A review of key assets: The report says as much as $3.5-billion could be recovered through monetizing - selling off or refinancing - key city assets such as Toronto Hydro, the downtown lake-water air-conditioning project Enwave, or the Toronto Parking Authority. This would be enough to kill off the city's $2.6-billion debt and eliminate the $440-million it spends annually in debt service charges. The mayor has ruled out an outright selloff of Toronto Hydro as a whole, but other options remain open.

Better managed real estate: The city should control all $17.9-billion of its holdings - and those of its arm's length agencies, such as the Toronto Transit Commission - from one office, with an aim to making an extra $150-million a year through development and selloffs.


link

Regarding uploading the TTC. From the same article:

quote:
A better-integrated transit system: In addition to a call for better co-operation between the Toronto Transit Commission and other transit agencies, the report calls for a study of the "costs and benefits of full integration of the regional transit system in the long term," which presumably involves the takeover of the TTC by the province's Metrolinx transportation agency, something the mayor has said he would fight.

Today there is a rally organised against Metrolinx's privatisation agenda. The City's Labour Council is a prominent part of this fight.


Words like "full integration", "efficiencies", "outsourcing", "monetisation" and "partnership with outside investors" are the tools of the neo-lib trade.

Whatever my personal thoughts are of Stanford, he has completely undermined the working class of the city. The right wing in this city are popping champagne and this self described "socialist" has given them the best cover of all.

Today there is further spinning from him:

quote:
Toronto Hydro. The utility that owns the wires delivering power to every home and office in Toronto.

The utility does make significant payments to the city: In 2006 it paid $46.2 million in dividends, and $60 million in interest on debt held by the city. But the panel says the potential is far bigger than that.

"By some estimates, Toronto Hydro could be worth $2.5 billion to $3 billion (before debt repayment of approximately $1.2 billion and taxes) if it were sold to another municipality, the province or the private sector," the report figures.

Even if the whole company isn't sold, sections could be chunked off. For example, one unit of Toronto Hydro owns the city's streetlights and markets energy-efficiency products; another unit, Toronto Hydro Telecom, has fibre-optic connections to 490 buildings. Neither is valued in the report, but Toronto Hydro paid the city $60 million for the streetlights in 2005.

Panel member Jim Stanford was swift to point out that selling isn't always the best option.

"You could do a partnership with outside investors," he said. "You could restructure the balance sheet of Toronto Hydro so the city gets to take more money out of it."

Toronto Hydro could even get into the business of generating renewable energy, he said – the corporation has already said it wants to explore a wind farm in Lake Ontario off the Scarborough Bluffs.

Opponents of hydro privatization were already warning yesterday that they'll jump into action if a sell-off occurs. Paul Kahnert, of the Ontario Electricity Coalition, said privatizing would lead to double-digit rate increases. And he warned that a private hydro utility would ignore important social issues such as protecting the environment.

The Toronto Parking Authority is a well-run business with respectable net revenue of $41.5 million in 2007, but the panel says more can be realized. One option: Turn it into an investment trust, meaning the city sells the revenue stream while continuing to own the real estate.

Real estate. The city also has extensive holdings through the TTC, the Toronto Economic Development Co. and its own offices and works yards. Sometimes, two agencies own adjacent properties, but don't get together to develop them. Other properties are simply fallow. Panel member Paul Massara points to the derelict bus terminal sitting on prime land at Yonge St. and Eglinton Ave.

The panel wants to put all the real estate holdings in the hands of a "senior officer for real estate."

"We believe the city could conservatively target $150 million annually from real estate development, sales, etc.," the panel said.


link

The neo-libs couldn't ask for a more "useful idiot".

ETA: Here's more info on today's rally. Found it on the CAW's own website:

quote:

The Greater Toronto Transportation Authority, now renamed METROLINX, is driving ahead with plans for new transit lines across the greater Toronto area. That should be good news – except that METROLINX is requiring every new transit project to consider a Public-Private Partnership option for its delivery.

This could include the subway extension through York University into Vaughan GO Transit, and the TTC’s Transit City LRT lines. METROLINX has no practice of receiving any deputations from the public on how it will spend billions of public dollars. Will all the vehicles be built off-shore, like with other P3 projects? Will it take four years for the public to get the facts, like with the Brampton Hospital?


RALLY AGAINST P3 TRANSIT

I wonder if Stanford was there talking about it being an opportunity to "partner with outside investors".

[ 22 February 2008: Message edited by: a lonely worker ]


From: Anywhere that annoys neo-lib tools | Registered: Jul 2005  |  IP: Logged
Mercy
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posted 22 February 2008 06:08 AM      Profile for Mercy     Send New Private Message      Edit/Delete Post
Highlights.

Full report.


From: Ontario, Canada | Registered: Feb 2007  |  IP: Logged
Politics101
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posted 22 February 2008 07:40 AM      Profile for Politics101   Author's Homepage        Edit/Delete Post
Toronto's financial and political troubles are "National News" shouldn't this be in the Ontario regional thread.
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Noise
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posted 22 February 2008 07:42 AM      Profile for Noise     Send New Private Message      Edit/Delete Post
Close politics101... It should be in the center of the universe forum
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Michelle
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posted 22 February 2008 07:49 AM      Profile for Michelle   Author's Homepage     Send New Private Message      Edit/Delete Post
Moving this to the forum that includes the centre of the universe.
From: I've got a fever, and the only prescription is more cowbell. | Registered: May 2001  |  IP: Logged

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