Economic Letter

David Bond is a retired bank economist who resides in Kelowna. This column appears Tuesdays.

This week, I want to briefly discuss three major errors made recently by provincial and local governments.

For taxpayers in Kelowna, a highlight is the episode of Diamond Mountain, a proposed development north of the city and adjacent to UBCO. The proposal would have provided about 1,000 new housing units within four kilometres of more than 7,000 jobs. It was rejected by council based upon what can only be described as shoddy analysis.

The developer, faced with sunk costs of more than $1.9 million, sought a division of the 170-acre property into 17 10-acre mini-ranches consistent with existing zoning, thereby avoiding any further issues with council.

The city belatedly came to realize that shooting down the 1,000-unit proposal and enabling subdivision into the high-end lots precluded any future development for denser housing for at least 50 years ... in an area where the city is growing rapidly.

So the city made an offer for the property in August 2018 and subsequently reached a deal for more than $11.9 million. Not only does this outcome impact taxpayers, it also denies the city the tax revenue the original proposal would have yielded. This is an example of the less-than-strategic management by council and public servants, none of whom have been held accountable.

In a non-B.C. example, Doug Ford, the premier of Ontario, acted despite a visible conflict of interest in the selection of the new head of the provincial police force, (the OPP). A long-time personal friend and mid-level supervisor in the OPP was the successful candidate only after the criteria for staffing the position had been lowered to permit his buddy to compete. The subsequent brouhaha painted the premier into a corner.

His reaction was to argue that appointing a head of the OPP is a “political matter” and not subject to the normal procedures for staffing. All the major newspapers in Ontario denounced the premier and the matter has yet to be settled.

It is remarkable how egoistical individuals such as Mr. Ford — or his role model Donald Trump — manage to shoot themselves in the foot time and again.

Back home in B.C., we have the current turmoil precipitated by the decision by the Speaker of the provincial Legislative Assembly, Darryl Plecas, to suspend (with pay) both the Sergeant-at-Arms and the Clerk of the House.

In a damaging report issued last week, the Speaker alleged that these two public servants had abused their positions by spending substantial sums on perks such as luxury international travel and expensive suits (creatively termed “costumes for work”).

The report goes also back several years to point out slipshod administration and oversight in the operation of the legislature, including negotiation of over-generous compensation deals with the two now-suspended individuals.

Much of this cozy arrangement was known to the government of the day and had been commented on by the Auditor General in 2007. Again in 2012, his successor found that nothing had been done by those responsible for oversight to correct what had been pointed out five years earlier.

When this news first broke back in November, the Leader of the Opposition, Andrew Wilkinson, rose to the defence of both suspended employees. After all, previous Liberal governments had appointed both to their positions and had then, it now appears, ignored the Auditor General’s flags.

Moreover — and this may well have been a motivator of Wilkinson’s indignation — the Speaker who moved to investigate had left the Liberal caucus thereby giving the current NDP government the votes needed (with the support of the Green party) to form the government. Now, Wilkinson is switching his stance saying that all parties should work together to solve the problem.

Each of these three cases illustrates the poor standard of governance Canadians are often settle for. We need more provincial and local politicians who are vigilant when spending other people’s money and scrupulous about protecting the interests of the voters and taxpayers first.

David Bond is a retired bank economist who resides in Kelowna. This column appears Tuesdays.

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