Political Donations the Penashue - the inside look

There is just something so blatant, so manipulative, so insulting to the citizens and the law of our country about Peter Penashue's electoral victory in 2011. For me, knowing how corrupted Newfoundland and Labrador politics is, this one drew my attention. Still, I seriously believed that nobody would have the gall to try and play the games they play with politics in this province on the federal level - with all its rules. I have to say I was seriously wrong on that one.

To start with, Penashue's campaign filed an initial return on March 19, 2011. Immediately jumping off the page are the 17 corporate donations, which are illegal, and in particular the Pennecon donation for $5,500.00 - which exceeds the allowable donation by an individual allowed to donate. That was just the initial take. There were 11 individual donations (although 3 were from a "K Williams" which would also violate the law) to go along with the 17 corporate donors. Total donations were $27,850 and $18,710 in non-monetary (read plane rides).

Then there is another list of contributors - all dated after March 19, 2011. There are only 2 corporations on this list, and 63 individuals. Together the two lists paint a picture of deciept, and corporate manipulation of the electoral process - in my opinion. Here are the facts, you be the judge. Don't be afraid to leave me a message on here of what your take is.

To begin with, the first list has three individuals names on it that disappear on the second list - which is odd if you believe Penashue needed all the individual contributions he could get to offset those corporate ones: John Higham, from Nova Scotia based Chignecto Consulting Group (they were the Innu Nation's advisors on the New Dawn Agreement deal); Sheila Montague; and a "K Williams" that made three seperate donations on Mar 30, 2011 (twice) and May 4, 2011. The remainder of the individual donators on the original list show up again on the second list.

This is where it gets tangly folks. This is where the ugly really comes. In this list you are going to find: family of a former provincial leader of the Liberal Party of Nova Scotia (and several people using his address to make donations - FYI he now doubles as President of Grand River Ironsands Inc in Labrador); principles of the Innu Nation's auditors (and family); executives of Pennecon and Penney Group, Law firms for the Innu Nation; Consultants for the Innu Nation; a Quebec construction company; Innu "partnerships" with private corporations; and the list goes on. To get the feel for what is happening economically and politically in Labrador, and Newfoundland for that matter, you need to read this and let it sink in. To make this as readable as possible I've broken down each donor one-by-one. Allowed or Disallowed is to indicate whether or not Elections Canada accepted the donation as legitimate:

Roland Andrews - Clarke's Beach councilor, campaign manager for PC Glen LittleJohn, and employee of NL Hydro-CFLCo. ALLOWED

Michael Barrett - President Academy Canada, Corner Brook. ALLOWED

Larry Barry - actually Lawrence Barry, sole director of Chaisson Construction, director of Innu-Chaisson Construction Ltd (Innu partnership). NOT ALLOWED

Brian Brace - owner Brace's Woodworking. NOT ALLOWED

Rose Branton - wife of Edgar Branton who is director of Innu-Rail Cantech Ltd (Innu Partnership with Quebec company) and financial controller of the Innu Nation. Address used on the return was that of Branton's Enterprises Ltd in Gould's. ALLOWED

Michael Burrell - actually Michael Barrett but entered as a different person. Address used the same as Barrett's. NOT ALLOWED

Gary Callahan - jointly owns Pencal Supplies Ltd with Max Penahue (Peter's brother). Listed on original donation list as Penecal Plasters which doesn't legally exist. NOT ALLOWED

Kathy Capp - listed with an address that does not match a postal code, and the city name spelled wrong, in Nova Scotia. No information is available for her. ALLOWED

Bryan Chafe - actually "Brian Chafe". Chief Operating Officer of Provincial Airlines. ALLOWED

Brad Cole - Vice-President at Pennecon. NOT ALLOWED

Sandy Connors - owner of Switch Electrical Ltd, in partnership with Cahill and Max Penashue (Peter's brother) and Bart Jack (Jr) in a "partnership" called "Iskueteu, A Limited Partnership" which is not incorporated. Fred Cahill appears as contact for Cahill and Sandy Connors for Switch. Cahill head office is listed as the "corporate" address and Switch's address is listed as the "operations" address. Cahill was awarded the ECPM services contract for Muskrat Falls by SNC Lavalin. Eskueteu has been awarded work on the Voisey's Bay project. NOT ALLOWED

Eric Coombs - Chartered Accountant - principle at Gardener Coombs Winsor Coombs Chartered Accountants (GCWC). Auditors for the Innu Nation. ALLOWED

Jane Coombs - wife of Paul Coombs, who is a principle at GCWC. Address listed on return is that of Ranstar HSE Services & Consulting owned by David and Renee Randell. ALLOWED

Lorraine and Robin Cooper - owners of Blizzard Corp, and Minipi Outfitters. ALLOWED

Brad Dalley - General Manager for Newfoundland Multi-Foods Ltd located in Labrador, which is owned by the Warr family. Bob Warr sits on the board of Newfoundland and Labrador Hydro. ALLOWED

Dove Dyer - address is that of Resource Development Associates Inc., directors David and Rhonda Dyer. No Dove Dyer was found. ALLOWED

Phillip Earl - Sole director, President and CEO of Air Labrador. NOT ALLOWED

Gail Ernest - Unable to locate in Nova Scotia. Incorrect postal code. ALLOWED

Salvatore Furino - Vice-President at H.J. O'Connell, a Quebec construction firm that has/had "partnerships" with Labrador Construction Ltd, SNC Lavalin, Innu-Kiewit and Sons (another partnership), and Innu Nation. H.J. O'Connell has been awarded the bulk excavation work on Muskrat Falls. ALLOWED

Barb Gilles - really Barb Giles, of Hodge Brother's Ltd - Lab City (company address used on return). NOT ALLOWED

Geoffrey Goodyear - director of Universal Helicopters, along with John Steele, Harry R. Steele, and Norm Noseworthy. Innu Mikun Helicopter Service (unincorporated) is in "partnership" with Universal Helicopters, Canadian Helicopters, and the Nunasiavut Government. ALLOWED

Michael Hickey - director of Hickey Construction (forestry). Partner in Kakatshu Limited Partnership - Innu partner is Michel Rich. NOT ALLOWED

Lloyd Hillier - Owner of Hotels North. Partner with Innu in Nika Wood. Innu partners are Michel Rich and Bart Jack (jr). ALLOWED

Steve Hurlburt - V.P. and Secretary Treasurer of H.J. O'Connell Ltd (Quebec). ALLOWED

Larry Innes - Partner at Toronto's Olthius, Kleer Townshend LLP, law firm for the Innu Nation. Resident of Alberta. No personal address in Labrador despite using a Goose Bay address on the donation return. Registered federally as a lobbyist using the address of the Innu Nation office in Happy Valley - Goose Bay. NOT ALLOWED

Innu Mikun Limited Partnership - partnership with Innu Development Limited Partnership (unincorporated) and Provincial Airlines (that supplied Penashue with a writeoff for most of his air travel during the campaign). ALLOWED

Kurt Jacobs - VP at Dexter Construction of NS, subsidiary of Municipal Group of Companies NS. Gray Rock/Municipal Group of companies formed "partnership" with the Innu Development Limited Partnership to create Innu Municipal GP inc/Gray Rock Mining. Jacobs is the General Partners contact in the partnership. ALLOWED

Gerald Kerr - principle at Chignecto Consulting Group Inc. Helped Innu Nation negotiate the Voisey's Bay and Lower Churchill Impact Benefit Agreements. Lists 9 federal departments as clients. NOT ALLOWED

Nancy Kleen - is actually "Nancy Kleer" founding partner of   Olthius, Kleer Townshend LLP, law firm for the Innu Nation. Unlike her partner she used the wrong name instead of the wrong address. ALLOWED

Leonard Knox - Vice President, Major Projects/Eastern Canada Bird Construction, parent company of  H.J. O'Connell Ltd. (Quebec) ALLOWED

Brian Lemessurier - President of H.J. O'Connell (Quebec) ALLOWED

Richard Levert - President of Levert Personnel. (Ontario) ALLOWED

Rich Lewis - owner Lewis Concrete Forming Ltd. Aboriginal business. NOT ALLOWED

Lloyd McDougall - Retired RCMP, owns Mass Consulting Inc (was on the original donors list) in NS (security). Also with CAI Logistics. CAI Logistics has a partnership with CAI Nunatsiavut Marine - a Labrador Ferry service. This person is listed under the same address as Francis MacKenzie, former leader of the Liberal Party of Nova Scotia and President of Grand River Ironsands. NOT ALLOWED

Gladys MacKenzie - wife of Francis MacKenzie, former leader of the Liberal Party of Nova Scotia and President of Grand River Ironsands. She is listed at the same address as Lloyd McDougall and Simeon Osmond. ALLOWED

Charles MacKenzie - relative of Francis MacKenzie, former leader of the Liberal Party of Nova Scotia and President of Grand River Ironsands. ALLOWED

Ed Murphy - Senior VP of Finance, Pennecon Limited. NOT ALLOWED

Donald Noseworthy - Senior VP of the Energy Division, Pennecon Limited. ALLOWED

Geraldine Noseworthy - wife of Donald Noseworthy. ALLOWED

Patrich O'Callahan - should be "Patrick O'Callahan" founder of East Coast Catering. They are in a "partnership" with Innu Development Limited Partnership to operate Labrador Catering Limited Partnership. ALLOWED

Gus Ollerreed - President, Provincial Airlines. ALLOWED

John Olthius - one of the founding partners of  Olthius, Kleer Townshend LLP, law firm for the Innu Nation. ALLOWED

Simeon Osmond - Atlantic Policy Congress for Aboriginal peoples (NS). Address listed under the same address as Francis MacKenzie, former leader of the Liberal Party of Nova Scotia and President of Grand River Ironsands. NOT ALLOWED

Neil Parrott - director N.E. Parrott Surveys Limited. Address used is business address. Involved with surveying Innu lands. Listed as N.E. Parrott Surveys on original donor list. NOT ALLOWED

Geoffrey Pearly - Could not find an individual under this name. The address listed for this person was false, and no such person lives at the address given in the return - personally verified. ALLOWED

Max Penashue - brother of Peter Penashue. Involved in numerous Innu companies. NOT ALLOWED

Ches Penney - Chairman of Pennecon Limited, Chairman of Penney Group holding over 60 companies and employing over 3000 people. NOT ALLOWED

Barney Powers - Father of Tim Powers of SUMA and vocal supporter of the Lower Churchill development. Barney Powers is a director of Labrador Construction (2005) Limited that had partnerships with H.J. O'Connell, Innu Nation, Labrador Inuit and Peter Kiewit and Sons. Apparently Barney has been retired for a few years, but his name remains on the corporate registry. ALLOWED

Carlos Presado - President Labrador Catering Limited Partnership. NOT ALLOWED

Provincial Airlines Ltd - the company that granted a major writeoff of the costs of Peter Penashue's election travel. ALLOWED

Larry Puddister - C.E.O. Pennecon Limited. NOT ALLOWED

Thomas Randell - Data provider - Innu Mikum Airlines. NOT ALLOWED

Edward Reid - Financial Officer, Department of Natural Resources, Government of Newfoundland and Labrador. ALLOWED

Angela Rich -  ECE Coordinator at Sheshatsui Innu First Nation; and director Innu Nation. NOT ALLOWED 

Paul Rich - Peter Penashue's brother in law. NOT ALLOWED

Ben Rich - director: Atsanik Nitassinan Scaffolding Ltd; Mamu Solutions Inc.; Uapishkut Construction Ltd.; Pishumuss Group of Companies; Shshatshiu Innu First Nation councilor; and Innu Nation. NOT ALLOWED

Charles Roe - unable to confirm any information here other than the address is wrong, but the postal code is right for a C.P. Roe. ALLOWED

Richard Sheppard - General Manager, East Coast Catering Ltd, in partnership with Labrador Catering Limited Partnership. Bidding on the Lower Churchill EPCM contract. NOT ALLOWED

Paul Snelgrove - President, Labrador Sales Ltd. Labrador Sales Ltd was on the first donors list. NOT ALLOWED

Perry Trimper - First VP Stantec Consulting. Involved in two Innu/ Inuit partnerships: Aivek Stantec; and Stassinu Stantec. Involved in the environmental assessment of the Lower Churchill project for Nalcor. ALLOWED

Jerry White - Chief Financial Officer Penecon Limited. NOT ALLOWED

Darryl Winsor - Chartered Accountant, principle at Gardener Coombs Winsor Coombs Chartered Accountants (GCWC). Auditors for the Innu Nation. ALLOWED

Herbert Woodward - President of: Hamilton Store Limited; Hamilton Wholesalers Limited; and Northland Catering Services.

And that is it! You may ask yourself, given the often repeating nature of corporate and innu relationships outlined here how Elections Canada decided to allow some donations and not others? It would be a fair question...The threads of this seem to be replacing obvious corporate donations with private ones. The donations almost all clearly corporate in nature. A number are disguised in an attempt to deflect scrutiny from the donators - that is illegal. There are some curious things happening in the Nova Scotia donations - especially those centered around the home address of the former leader of the Liberal Party there. There are somewhat shocking ones like those of the auditors of the Innu Nation. And so it goes. You be the judge. My conclusion is the RCMP should be first in and last out here, and Peter Penashue should not have the audacity to run in a byelection that was caused by such obvious manipulations. In many ways this election return reflects the nature of politics in Newfoundland and Labrador where anything goes and there is no accountability. That is not how it goes nationally though...Mr. Penashue and company.

One last story for you to digest on while you contemplate what you read here: http://news.nationalpost.com/2012/07/13/innu-nation-angry-as-former-chief-paid-1m-in-two-years/



FROM THE ELECTIONS CANADA ACT:

No circumvention of limits

405.2 (1) No person or entity shall

• (a) circumvent, or attempt to circumvent, the prohibition under subsection 404(1) or a limit set out in subsection 405(1) or section 405.31; or
• (b) act in collusion with another person or entity for that purpose.

No concealing of source of contribution

(2) No person or entity shall

• (a) conceal, or attempt to conceal, the identity of the source of a contribution governed by this Act; or
• (b) act in collusion with another person or entity for that purpose.

Prohibition – accepting excessive contributions

(3) No person who is permitted to accept contributions under this Act shall knowingly accept a contribution that exceeds a limit under this Act.

Prohibited agreements

(4) No person or entity shall enter into an agreement for the provision for payment of goods or services to a registered party or a candidate that includes a term that any individual will make a contribution, directly or indirectly, to a registered party, a registered association, a candidate, a leadership contestant or a nomination contestant

Riadh Ben Aissa, Danny Williams, and SNC Lavalin

Riadh Ben Aissa (Aissa) has become a very well known name around Canada and the world. The former Vice-President of SNC Lavalin's Construction Division and international salesman/fixer is currently sitting in a Swiss prison. He is being investigated for a multitude of sins which include, among other things, channeling funds through offshore accounts for bribes and his close relationship with the Gadhaffi family of Libya. He was characterized early on in the SNC corruption scandal as a rogue executive and fired. However, as time has marched on it has become clear that he in fact was simply doing the job SNC paid him to - grease the wheels to get contracts (primarily internationally). So far there has been one major bribe in Canada revealed - the Montreal hospital $22 million payment.

You may ask: "What does Aissa have to do with Newfoundland and Labrador?" The truth is a lot more than we know or have been told. Have you ever heard the man's name brought up in the context of this province? Likely not - until now. It starts with BAE Newplan Group Ltd - or rather it's forefathers. BAE Newplan Group Ltd is the result of Newplan Consultants Ltd merging with Newplan Holdings Ltd, and then merging with BAE Group Ltd. The merged company, BAE-SNC Limited, was then a SNC Lavalin subsidiary in this province. It had two directors of note:

1) Elwood J. Ried - was the President of BAE Newplan until he died suddenly in June, 2012. He and fellow BAE executive Albert Williams formed a numbered company in 2009 to construct the condo  known as "The Narrows" in St. John's; and

2) RIADH BEN AISSA - yes that's what I said - the man of international intrigue and money laundering offshore accounts.

Here is the document from the Government of Newfoundland and Labrador Corporate Registry (CADO):

Dr. Rafik Ben Aissa, Aissa's surgeon brother put it this way:

"Absolutely nothing my brother has done was unknown to the board of SNC-Lavalin. Unfortunately, when it comes to keeping money and business deals going, discrimination, lies, and injustice have sometimes no international limits."

Of course this immediately places many of the deals done in Newfoundland and Labrador over the last twenty years under the microscope. The first question is why would this man in charge of international construction with headquarters in Tunisia, who did mega deals all over the world, be one of two directors in this tiny Newfoundland company? That's a big question. Certainly SNC Lavalin did a lot of business in the province from the mid 1990's on. They have secured a number of contracts with Newfoundland and Labrador Power ( a Crown corporation) and also with its successor Nalcor. Billions of dollars in business. It is alleged that $22 million dollars in bribes were channelled through a Carribean country for SNC to secure the Montreal hospital contract - worth about $1.5 billion and handled by Aissa. Using that as a yard stick, what could be the bribes involved in a $6.5 billion or so contract? SNC secured that contract just after former Premier Williams left office.

Aissa's Newfoundland involvement has some more direct, and problematic questions that need to be addressed. For starters there is the founding of Innu-SNC Lavalin Corp - a joint corporation formed by the Innu Nation (a non-governmental but still government-like organization) and SNC Lavalin. The Board of Directors consists of: Albert Williams (BAE Newplan/SNC VP of Strategy and Development); Steve Lindley (VP of Aboriginal Affairs at SNC); Prote Poker (Innu Chief); and Anastasia Qupee (Innu Chief). The Corporation was formed February, 2008. According to the corporate registry Aissa was still a director of BAE Newplan at that time. In September 2008, the New Dawn Agreement was signed between the Innu Nation, Nalcor, and the Government of Newfoundland and Labrador to pave the way for the Lower Churchill hydroelectric project. Both Prote Poker and Anastasia Qupee signed the agreement along with then Deputy Grand Chief of the Innu Nation Peter Penashue.

Peter Penashue, elected as an MP in 2011 under the Conservative banner has subsequently had to resign for improper/illegal campaign donations - almost all his donations were corporate which he subsequently tried to cover up, but the cover up was rejected by Elections Canada. One very questionable issue for him was the illegal interest-free loan granted by the Innu Development Limited Partnership (the unincorporated head organization that administers all the "partnership" organizations the Innu Nation enters into - like Innu/SNC Inc. for example). Elections Canada reports there is no paper trail for this $25,000 other than a single letter, signed by Penashue's brother-in-law, that says a loan was given to Penashue by the Innu Development Limited Partnership. Of course this can not be true as the Partnership is not incorporated and so cannot have a bank account from which to lend money. He is now running in the by-election that he created by resigning over the fiasco.

However, the bigger question remains: Were Peter Penashue, Prote Poker, and/or Anastasia Qupee in a conflict of interest while negotiating the New Dawn Agreement on behalf of their people? Did their board membership on the Innu/SNC corporation create a very obvious pecuniary conflict of interest? My opinion is if they were paid to be on that board then without question. My understanding is they are paid to be on that Board. Were they also in the same conflict of interest when they sold the agreement to their people so they would endorse it by referendum and thereby give it legitimacy? Again, I would say yes. What role did Aissa play in this as director of SNC's outpost in the province? It's difficult to know that without a thorough RCMP investigation. One thing is certain - BAE-SNC Limited was still in existence at that time and so was Aissa.

Then there is the issue of our former Premier Danny Williams. As stated in a previous blog, Williams had two offshore service companies: Spectrol Energy Services (with a Texas Subsidiary); and Atlanic XL. Both companies had William's brother Edward, recently appointed to the Canada Newfoundland and Labrador Offshore Board (CNLOPB) after leaving the Premier's office as an advisor, on their Board of Directors. This remained the case even after they were put in a "blind trust". Both companies gained lucrative contracts in the offshore oil developments around the province while Williams was Premier. Williams negotiated many of these agreements, including the necessity of using Newfoundland and Labrador companies - not unlike Penashue and his family's dealings and the Lower Churchill Impact and Benefits Agreement. The direct result was his companies grew and prospered - as did Penashue's family business interests.

On December 31, 2008 BAE-SNC Limited was voluntarily dissolved as a corporation. A new corporation was formed to take its place - BAE Newplan Group Limited. Why the one containing Aissa as director was dissolved and another created to take its place is puzzling. The new corporation has a directorship of four (all senior SNC people) as opposed to two at the old company. In any case it dissolved, as did the formal traces of Aissa in Newfoundland and Labrador. Four months later SNC Lavalin purchased Danny Williams offshore service companies for an undisclosed amount. The deal, secret as it remains, could have been constructed to give Williams an artificially high value for his companies - a common practise in corporate corruption prosecutions world-wide. We simply do not know. What we do know is the man at the centre of SNC's corruption practices had effective control of SNC's one subsidiary in the province at the time. We know his reputation. Williams was prepared to place himself in a conflict of interest by negotiating offshore agreements while owning companies that would benefit from the Newfoundland and Labrador policies of those agreements. Newfoundland and Labrador's conflict of interest legislation states:

"Statutory duty

3. A public office holder shall not make or participate in making a decision in his or her capacity as a public office holder where the public office holder knows or ought reasonably to know that in the making of the decision there is the opportunity to benefit himself or herself or a member of his or her family improperly, directly or indirectly. "

 

Four months later, then Libyan leader, and personal/professional friend of Aissa and SNC, Moammar Gadhaffi, announced he wished to stay overnight in St. John's of all places. Apparently it was simply a refueling stop enroute back to Libya after speaking at the United Nations. Of course any person with a sense of direction realizes Libya is southeast of New York, and to travel several hours north makes no sense on the face of it. Williams was also very, very silent on the issue. While the Canadian government threatened Gadhaffi with lectures on terrorism the provincial government, and Williams, simply refused to comment. It is apparent that Gadhaffi was a man of deliberate action and it would be hard to attribute such a visit to shear coincidence based on a really poor sense of direction. What is more likely is Gadhaffi wanted to meet with Williams, or some person/people associated with Williams based on his friendship with Aissa. It was apparent that it made some people very nervous. Gadhaffi was so incensed by the treatment he was to receive should he stay in Canada that he threatened to nationalize Petro Canada's assets in Libya. He eventually changed his mind, but he was clearly insulted by the treatment of his potential hosts.

 

What other influences could Aissa have exerted in this province while a director of BAE? Well there is the whole political donation thing. Over the last 17 years BAE has donated a total of $239,170.00 dollars to political parties here. The receiving parties have been the PCs and the Liberals while the NDP have not received a cent. The Liberals received $111,965.00 - primarily from 1996-2000. The PCs received $127,205.00 - $113,800.00 after 2000 when Williams became leader of the PCs. Those dollar figures put BAE in the top three of political donors in Newfoundland and Labrador. They donated every year from 1996-2011. They donated in by-elections. They donated in elections, but only to one party - the one that won. Some interesting donations of note: Ed Byrne ($2000 in 2003-he became Minister of Natural Resources under Williams); Jerome Kennedy ($1000 in the 2006 Quidi Vidi by-election and again in elections-has been Minister of Finance and Natural Resources); Terry French ( ranging from $500 to $2000 in various elections and one by-election - served a number of Ministries including Environment); Paul Davis ( on numerous elections - responsible for Government purchasing); and several others. Bottom line, all of these people that received political donations had involvement with the Lower Churchill project and accepted donations from a company directly involved with it.

 

Should the RCMP be investigating the Riadh Ben Aissa relationships with: the Government of Newfoundland and Labrador; Nalcor; Danny Williams sale of his offshore companies; the Innu involvement with SNC and the New Dawn Agreement; etc? My opinion is yes. The conflicts of interest are obvious. Aissa's reputation as the guy that greases the wheels is established. His own brother does not deny that. A month or so ago contacts from Labrador to St. John's were floating news that SNC's office in St. John's was emptied out early in the day and staff told not to come back for that day. VOCM talk show host Paddy Daly twittered that he had heard rumours the RCMP raided SNC's St. John's office.

 

Could be that the RCMP have already become aware of something we were not - Aissa's reputation and his ties to Newfoundland and Labrador.

 

 

 

 

 

.

The Battle in Labrador Heats Up

Todd Russell,President of Nunatukavut, being arrested

at Muskrat Falls protest 5 April 2013

 

You won't see the picture above on any of the main media outlets in Newfoundland and Labrador. Yet this was the scene yesterday when the duly elected President of the Nunatukavut was arrested 10km from Muskrat Falls for interrupting traffic with 20 or so followers. The purpose of their action was to draw attention to the fact that they have not been consulted or accommodated about the Muskrat Falls project despite it being within the territory they claim.

 

It's a tale of three nations really: the Innu of Labrador; the Nunatsiavut; and the Nunatukavut. They are the Aboriginal peoples of Labrador.

 

THE INNU OF LABRADOR

 

 

                                                   Peter Penashue, Innu of Labrador

 

The Innu of Labrador, and specifically an organization called the "Innu Nation" are the subject of a three part series coming up on this blog. In the meantime, you can think of the Innu of Labrador as "haves" and "have nots". The "haves" are a very few families that control all the business done in Innu territory and the workings of the Innu governments - that will also be detailed in the series. The have nots are almost all the rest of the Innu. Stricken by third world poverty, and every social ill you can imagine, the "have nots" have been left to fend for themselves. Of course, there are also many Elders in the Innu community that are very hesitant about the new development mentality sweeping the "haves" along. They stand in their place to defend ancient responsibilities to the Land and the animals. Perhaps the best known being Elizabeth Penashue, the mother of the man above - Peter. Polar opposites in values, ideals, and how to get there. Ancient responsibilities versus one ancient problem - greed.

 

                                          

                                                                   Elizabeth Penashue

 

Bottom line - we never saw Peter Penashue dragged across the streets by police like a common criminal. No. He went the other way. Deals with corporations, deals with politicians, etc. They needed him on board for Muskrat Falls, and yet he is now the one facing a possible criminal action as well. His obvious breach of Elections Canada laws, as noted in the previous posting on this blog, should land him in a pair of handcuffs - although nobody deserves to be dragged. His handcuffs will not be chains restricting his freedom to protest. No, they will be chains restricting him from further breaking the laws of democracy.

 

THE NUNASIAVUT

 

 

                                                                 Sarah Leo, President

 

The Nunatsiavut, or Inuit, are the only native peoples in Labrador to actually have a government - established by the only finalized land claim agreement in Labrador. Their primary emphasis is on individual and community health. By way of example, the Nunatsiavut government is conducting, and funding a study of the impact of mercury poisoning in Lake Melville and estuaries within their boarders. They are doing this without any assistance from the provincial government, and in many ways against the provincial government. Their waters have been poisoned by the Upper Churchill dam, and they are rightly concerned about it becoming even worse with two more dams proposed for the Lower Churchill. Not surprisingly they are not partnered with large corporations or governments in many if any cash producing schemes. They remain focused on their people, and not the almighty dollar.

 

It's a tale of three peoples, three leaders, and three different approaches. The three part series on the Innu Nation will show this in dramatic and shocking form.

 

The question in my mind remains: How can it be that the elected leader of his people, a former Member of Parliament in his own right, be handcuffed and dragged through the streets like a common criminal? Did that happen to any other Aboriginal leaders during the "Idle no more" protests? The answer is no. So why did it happen to President Todd Russell? Are the Nunatukavut somehow less Aboriginal in the minds of the Newfoundland and Labrador government? Are Aboriginals less respected in Newfoundland and Labrador than other provinces? Is Nalcor's determination to build Muskrat Falls more important than basic human rights? The answer to all three of these questions is yes.

 

One last, but not least, mention. Jim Learning, Nunatukavut Elder and Veteran was arrested along with Todd Russell yesterday. He was also arrested a short while ago for walking down the Muskrat Falls access road without permission from Nalcor. He has been left in jail for the weekend and word has it he will be there until next Friday. His crime? Disrupting traffic to Muskrat Falls. On his own Aboriginal land. Jim Learning refused to sign a statement he would not return to do the same again. So they left him in prison. Jim Learning is a Veteran, an Elder, in his seventies, and a man of conviction - a hero. Thank-you Jim.

 

 

                                                         Jim Learning, Hero, Inspiration

 

 

 

 

Budget Fixing

I was taken back, like everyone else this week, when our local PC gang announced the projected deficit for 2013-14 had dropped from $1.6 billion to around $500 million. Just how was that possible in two months? Sure, they terminated 100's of civil servants, actually about 1200 in elimination of positions and layoffs of actual workers, but that would represent a mere drop in a large bucket when it came to a $1.6 billion deficit. So I had a good look.

And when I looked I was astonished. Going back to 2010, and moving forward each year til the present 2013 budget, I discovered fixing - budget fixing. I have attached copies of my analysis below so you can see year-by-year budget-to-actual comparisons. You can see where the government came in high on projections and where they came in low (the low has a negative sign in red). Going through this process a definite pattern evolved. A cynical pattern. One the government has not admitted to publicly, but would rather take a heap of abuse for. Another pattern for these folks. The more abuse they are willing to take publicly over something they could easily explain the more you should be concerned - such is the case here.

Below are the Budget vs Actual spread sheets for you to see, 2010 - 2013. Pay attention to the patterns you see, then move to my analysis below them.

So there you have it. The obvious, deliberate tool used is overstating ministerial budget, and then not using them fully. A good example is the $645 million that was scheduled to be transferred to the Department of Natural Resources, but ended up being $404 million dollars light. You will notice that revenue is almost never overestimated, while government budgets are almost always overestimated - especially in 2011, 2012, and looks to be the same for 2013.

As you can see, "austerity" started early as in 2012 $790 million that was budgeted to be spent by departments was not.In the same year total revenue was only $148 million over. Add the two together and expenditures were actually under budget by about $650 million. In that year every single government entity other than Executive Council came in under budget.

Then there was 2011. That was the year when we got the big oil return we weren't expecting - $531 million to be exact. However, the untold story is that every government entity also came in under budget except Government Services and Human Resources, Labour, and Employment. See the trend. The obvious trend is overstate transfers from the consolidated fund (the government's bank account) to government department's and agencies; understate revenues from all sources; and combine the two to keep "miracle" surpluses happening - which brings me to another point. A strategy such as this, keeping in mind how the government is not advertising the fact it is not spending the money it has allocated to programs like roads etc, is being used by the government to achieve several goals. The first and most important is it allows them to skim from departmental budgets to add increasing dollars to their cash and investment portfolio - more on this in a minute. The second is it allows them to seem like economic miracle makers, and fine "stewards" of the economy and public purse. And of course, it keeps the public away from demanding money for those programs that always seem to get big announcements, but few things change. The obvious reason for that being of course the full budgeted money is not spent on the programs, so relatively few things do change. As many people, especially outside the overpass say, "where has all the money gone?"

Well, here is what the government is doing with it. They are building a war chest of sorts. It's called CASH ON HAND/TEMPORARY INVESTMENTS. It means money they have put away by clawing it from programs it was originally budgeted to meet the needs of. Here is how that fund has grown:
2002 - $ 509,520,000
2003 - $ 185,404,000
2004 - $ 688,960,000
2005 - $ 833,802,000
2006 - $ 600,264,000
2007 - $ 1,316,660,000
2008 - $ 2,267,497,000
2009 - $ 1,921,837,000
2010 - $ 2,212,774,000
2011 - $ 2,442,963,000
2012 - estimated $2.6 - 2.7 billion.

So, the government has a huge bank account that they've been skimming money from department/program budgets for. They've invested it in mostly very low interest bearing accounts, but it's there. The infuriating part of this, beyond the lies and manipulation of this government to their own people is the damage we are now seeing inflicted for absolutely no reason on the civil service of the province. The people who make up 25% of the entire work force of the province. You can argue that it's overdue. You can argue that government is too big, etc. That is all ideological whether it be from a pure economic or political point of view. The reality is 1200 people, representing 1200 families will now lose that security that allowed them to buy that over priced home, buy that new car, etc. It is a double betrayal - one of the facts, and two of the duty to be responsible not just with money, but also with people's lives. It is the ugliest of politics. It is very much like the poll fixing fiasco - government orchestrated manipulation of opinion to suit their own ends. This one involves budgets and people's lives. This one is budget fixing.

The Benefit of the Doubt - Penashue

So the inevitable finally happened and Peter Penashue fell on his sword - resigning last week as both Minister and Member of Parliament. His faithful campaign manager, dutifully appointed to a plum post as director on the Canada-Newfoundland and Labrador Offshore Petroleum Board (CNLOPB), followed suit and resigned his plum appointment. It appears to be an attempt to pre-empt the release by Elections Canada of its report into electoral fraud involving the Penashue's election as member for Labrador. Of course, we have all heard him blame the fiasco on a well-meaning, but inexperienced campaign manager. However, do the facts really back that claim?

To start with there is the story from Aboriginal Peoples Television Network(ATPN). They broke the story of the many inter-linked business interests of Peter Penashue's family surrounding Muskrat Falls, and senior executives of Pennecon Limited http://aptn.ca/pages/news/2012/11/29/penashue-faces-questions-over-family-business-ties-to-labrador-hydro-project/ . A sort of "common-law" marriage if you will.

Then there is Mr. Reginald Bowers - the "inexperienced but well meaning" campaign manager/business manager of Mr. Penashue's electoral endeavour. Bower may be many things, but inexperienced is not one of them. His CV includes a Bachelor of Commerce degree, a senior accountant for David G Curtis and Co., a comptroller for Woodward Group of Companies, and VP of Finance and Administration for Fahey Group of Companies. Not exactly someone with no ability when it comes to finances if you get my drift. When it comes to connections the Masonic Order is the place to be for many, and Bowers founded the Masonic Lodge #17 in Happy Valley Goose Bay. He was big when it came to the provincial PC's as well. According to his official bio, Bowers has been a director of the Lake Melville area PC Association since the early 1990's. He even pulled off a double term as a director on the Board of the College of the North Atlantic (a plum provincial political appointment), along with Gilbert Bennett of Nalcor Energy.

A quick look at the PC donors to the last provincial campaign in Lake Melville district reveals an almost completely corporate dependent campaign. A number of those donors are people that Bowers would have been involved with in one way or another - including Provincial Airlines. It would seem that the provincial PC machine in Lake Melville decided to get behind Penashue for his bid to go to Ottawa, and everyone fell into line.

Then in October, 2012 the CBC broke the story that Penashue's flights throughout the election had been illegally subsidized by Provincial Airlines. Then, the CBC wrote a story that:

" Six executives of Pennecon made donations to Penashue's 2011 campaign in the riding of Labrador, with the donations arriving just after he had been elected, according to Elections Canada records.

Chairman Ches Penney made a donation of $1,100, the same amount donated by several others at the company. Two donated $550 each. The limit for a personal donation during the 2011 campaign was $1,100."

Remember those late arriving donations.

The Innu Development Limited Corporation, run by Penashue's brother-in-law Paul Rich, chipped in a $25,000.00 interest free loan - which is illegal. In addition, CBC News calculated Penashue had overspent his campaign limit by about 21 per cent. Now Elections Canada has said there were a total of 28 unlawful donations. I use the words unlawful, and illegal, because the donations were in violation of the law - the Elections Act. Now Penashue is blaming Bowers, and Bowers is claiming ignorance. But are these excuses credible? No, they are not.

EXHIBIT ONE:

From the Huffington Post, July 24, 2012:
" Bowers wrote that he checked all expenses with Conservative Party advisers and Elections Canada "and somewhere I got the understanding that all travel within the riding was considered personal expense and not governed by the cap on expenses."

EXHIBIT TWO:

From the CBC, November 29, 2012:
" In a statement, Penashue's office said that his campaign staff had a full understanding of the rules.

"The minister was very clear during his campaign that no corporate donations would be accepted, and that donations to his campaign were to be personal donations made by individuals," the statement said.

Although the story is changing now to one of ignorance of the rules, it is clear from Bower's and Penashue's earlier statements to the press, when the story first broke, that they were both fully aware of the rules, and that corporate donations were not to be accepted. Given that, it is impossible for both to have signed the return not being aware that corporate gifts in kind were illegal and corporate donations were illegal.

It is also apparent that a cover up of those expenses was attempted. In particular, it is now known that a deposit slip from Pennecon was recorded by the campaign in the same amount that its executives were retroactively given receipts for. In other words, it appears the campaign attempted to whitewash the donation by Pennecon by issuing receipts to its executives. It is also worth questioning why Pennecon or its executives did not question receiving receipts for donations they did not make, or made and did not get a receipt for making.

The waters are murky with questions, but one that isn't in doubt is that everybody knew the rules, and some made deliberate attempts to circumvent them. No doubt the effort to get Penashue elected was of paramount concern to some people/corporations, but why? That will come out in the wash as they say, but here is an interesting nugget for you to chew on in the meantime.

IT STARTS LIKE THIS:

INNU/SNC-Lavalin Partnership

In February of 2008, SNC-Lavalin Inc. (SLI) entered into an agreement with Innu Development Limited Partnership (IDLP) to establish Innu/SLI Partnership, the purpose of which is to pursue engineering and project management opportunities for projects taking place on Innu lands and other areas of Labrador. Other business ventures jointly pursued include procurement, construction management services, power generation/transmission, industrial process, environmental services and architectural design. The intent of the relationship is to maximize benefits to the Innu People resulting from these projects. The partnership maintains and operates an office and related support infrastructure in Goose Bay.

IT GOES ON LIKE THIS:

Innu SNC Lavalin Inc.

Map data ©2013 Google - Terms of Use

Box 119
Sheshatshiu
NL
A0P 1M0
Contact(s): Brian Corbin
Mobile: 709-897-7601
Email: brian.corbin@snclavalin.com
Albert Williams
Email: albertwilliams@snclavalin.com
General partner:

BAE .Newplan Group Ltd.
1133 Topsoil Road,
Mount Pearl, NL A1N-5G2
Phone: 709-368-0118
Fax: 709-368-5410

Contact: Albert Williams
Email: albertwilliams@snclavalin.com

Innu partner: INNU DEVELOPMENT LTD. PARTNERSHIP
P/O Box 449,
Sheshatshiu, NL A0P 1M0
Phone: 709-497-3670
Fax: 709-497-3677
Core business:

1. Project management
2. Engineering Services

IT INVOLVES THIS:

Exhibit Title Prepared by Dat

CE-15 Rev.1 (Public)

Muskrat Falls Hydroelectric Project, MF 1010 – Review of

Variants SNC Lavalin March 2008

CE-16 Rev.1 (Public)

Muskrat Falls Hydroelectric Project, MF 1050 – Spillway

Design Review SNC Lavalin December 2007

CE-18 (Public)

Muskrat Falls Hydroelectric Project, MF 1250 – Numerical

Modeling of Muskrat Falls Structures SNC Lavalin May 2008

CE-19 (Public)

MF 1300 – Muskrat Falls 2010 Site Investigation, Volume

1 SNC Lavalin June 2011

CE-20 Rev.1 (Public)
MF 1310 – Muskrat Falls Site Access Review SNC Lavalin February 2011

IT CAUSES A CONFLICT OF INTEREST WITH THIS:

http://www.releases.gov.nl.ca/releases/2008/exec/0926n07agreement.pdf

In other words, while Penashue was busy negotiating the New Dawn Agreement on "behalf of the Innu people of Labrador" his organization already negotiated a side deal with SNC Lavalin who, at the time, were primary contractors in the development of the Lower Churchill, and had a business relationship with the Government of Newfoundland and Labrador. In fact, Penashue was in so many conflicts of interest it's hard to keep track of them all. Given SNC Lavalin's current international, and national disgrace over corporate corruption, and given the many links between it and the Innu, there are reasons for serious questions to be asked. However, the bottom line is Penashue negotiated and signed an agreement (the New Dawn Agreement) that cleared the way for members of his family, if not himself, to be greatly enriched - especially including the Impacts and Benefits Agreement.

Is Penashue an innocent victim of an incompetant manager? Does an innocent person place themselves in these types of conflicts? Do they try and cover them up when exposed by the media? Are they innocent if they admit they knew the rules and then broke them for their obvious benefit? There is nothing innocent about this story. It's an all too familiar politics. Should there be further investigations into the role of the Innu Nation, and its subsidiaries? Without a doubt. Were the Innu people of Labrador betrayed by the interests of their elite? That question could be answered in a full, and over due RCMP investigation of the operations of the Innu Nation, and most certainly its subsidiaries. For now it's just a question. Does Peter Penashue deserve the benefit of the doubt? Absolutely not. 

 

 

UPDATE

 Here is the complete list of original donors to Penashue's campaign. Thank you to those that provided it.

 

First List Submitted

 

 

 

Modified List (the scratched out are names ruled to be illegal and for which Penashue's campaign reimbursed the feds)

 

 

 

 

 

 

Newfoundland and Labrador's Waterloo - The Lower Churchill

You may have noticed in the last month or so my posts have been few, and far between, as I have been embroiled in a constitutional challenge of the Lower Churchill/Muskrat Falls hydroelectric development. This challenge is ongoing, albeit sporadic at the moment. Like every battle, there are long periods of boredom interspersed with sheer moments of terror (although that is overstating it on my part, but likely not on some people's part). And in a moment of quiet I take this time to share a few thoughts.

Often in life, as is the case here, it is not what people say, but rather what they don't say that should peek our curiosity. Lies of omission rather than outright lies. The grey area between the lines. Most of us, in our day-to-day lives, simply don't have the time or inclination to truly examine the lines fed to us by  our politicians. We take comfort in the fact that they are restrained by the law, and even though we see them as self-interested at best, we believe that interest is restrained and we are safe.

In the case of the Lower Churchill project, to borrow a line from former premier Williams, " nothing could be further from the truth". The fact is Williams proceeded, like the Abitibi expropriation, with an "I'll do what I want, take me to court",  which was typical of his ego centered policy decision-making process as premier, and in some ways in his business dealings as well.His determination to reach an objective, with apparent lack of care for the inevitable consequences was admired when it came to such things as the Atlantic Accord. However, as Napoleon found out in Russia, over-reaching ambition with little or no regard to the factors limiting your goal can, and likely will, result in failure. In Napoleon's case, as in the case of every other empire in world history, the stubborn refusal to acknowledge the limitations of his power, and to become over extended, resulted in the collapse of his empire and country. The people of France paid a price the country never really recovered from. This is about to be the case for Newfoundland and Labrador.

Since Williams came to office, and with the creation of his "Energy Plan", his focus was to use every aspect of the provinces resources to their maximum. Nothing wrong with that on its face. However, in his determination, some say ego, he refused to acknowledge that through historical mistakes the Upper Churchill was captured by Quebec. In a business decision, between Brinco (a private corporation owned by people like Winston Churchill, the Rothchilds, etc...including Joey Smallwood) and Hydro-Quebec in 1969, the power created from the Upper Churchill was sold for a seventy year pitance. This province has witnessed government after government attempt to undo the damage that one private monopoly visited upon it with the blessing of the government of the day. They have all failed.

Williams decided he would not follow that sorry record. In 2007 he ammended the Electrical Power Control Act to force water management agreements upon power producers sharing the same river. Then in 2009 Nalcor got such an order against its own subsidiary CFLCo, and thereby Hydro-Quebec, forcing in a sense an amalgamation of the Upper Churchill dam into a new Nalcor dominated operation.

The water management agreement stripped Hydro-Quebec of the operational control of the dam and gave that power instead to a water management committee. The new water management committee consists of four people - two appointed by Nalcor and two appointed by CFLCo (which is dominated by government of Newfoundland and Labrador appointees). In other words, the water management committee is now controlled by the government and it in turn controls the Upper and Lower Churchill. With this power it intends to redistribute power generated at the Upper Churchill, and take between 1500 to 2000 MW a year from Hydro-Quebec for its own use. The two power lines being built from the Upper Churchill to Muskrat Falls are capable of transmitting 2000 MW, and the sub sea link between Labrador and Newfoundland is capable of being upgraded to 1900 MW with minor alterations. Most Newfoundlanders would argue this is a great thing, and how could anyone who loved the province argue against it let alone fight it.

Here's the thing, its not legal. It's unconstitutional. Back in 1984, when Brian Peckford attempted the Water Rights Reversion Act, the Supreme Court of Canada ruled it ultra vires (outside the province's constitutional power). Bottom line, the Power Contract of 1969 was governed by the laws of Quebec, and therefore any law infringing on Hydro-Quebec's right to operate the dam and sell its power was unconstitutional, and therefore illegal. This is the great Russian winter that our modern day Napolean (tongue firmly planted in cheek) chose to ignore. In fact, way back in 1984, the Supreme Court of Canada had this to say about Newfoundland's position:

"It was argued by the Attorney General of Newfoundland that control over the power generated at Churchill Falls is essential for the effective management by Newfoundland of its water resources and to meet the energy needs of the Province. However, it is not for this Court to consider the desirability of legislation from a social or economic perspective where a constitutional issue is raised...Where governments in good faith, as in this case, invoke authority to realize desirable economic policies, they must know that they have no open-ended means of achieving their goals when there are constitutional limitations on the legislative power under which they purport to act. They are entitled to expect that the Courts, and especially this Court, will approach the task of appraisal of the constitutionality of social and economic programs with sympathy and regard for the serious consequences of holding them ultra vires. Yet, if the appraisal results in a clash with the Constitution, it is the latter which must govern. That is the situation here...and it follows that the Reversion Act is ultra vires."

And so it goes here. Putting lipstick on a pig, Williams and company charged ahead with the Lower Churchill. Hydro-Quebec, as strategic as ever, sit back and wait for the prey. They know what Williams did was illegal. They know that all they need to do is let this province build that dam, using all its resources to do so, and then the moment the government tries to apply the restrictions of the water management agreement upon them they go to court, win, and CFLCo is bankrupt. They also have first right to the shares of CFLCo and they have the right to operate the dam when CFLCo goes bankrupt. Set, game, and match.

This province's gross debt at the end of 2012 was $13.3 billion. Building Muskrat Falls, the transmission system, and the link to the Island will add another $10 billion or so. By 2016, the same year the Power Contract renews for another 25 years, we will have a gross debt in the range of $25 billion. When Hydro-Quebec springs its court case, around the same time, and wins, we will be unable to continue paying for Muskrat Falls, the link, and the transmission system. The federal loan guarantee says if any one of these parts goes into default they all go into default. It also states the federal government alone is entitled to these assets in the case of default. The end result is Newfoundland and Labrador loses the Upper Churchill to Hydro-Quebec permanently, it loses the Muskrat Falls project to the federal government who can sell it to whomever (likely Hydro-Quebec), and the people of this province are left with a massive debt that, with a declining population, will permanently cripple the economy and people. This is the natural consequence of Williams actions. And this is why I fight.

A billion dollars has already been wasted. A political scandal for the ages. But, even at that, its a better scenario than continuing the madness. If only Napolean had pulled his troops back before
the onslaught of the Russian winter he may have saved his entire empire.  Yet, ego drove him forward, and in the end he left his troops to freeze to death in Russia while he escaped back to France. Today we have the tools to stop our modern day Napoleans from delivering us into a similar fate. It is incumbent on us to use them.