Summer election may be fought over sneaky clause in budget bill

Dalton McGuinty is threatening to pull the plug on his own government after the opposition parties amended his budget bill yesterday in the legislature’s finance committee.

Like the Harper government budget bill, the McGuinty government inserted a large number of legislative amendments to create a massive omnibus bill. Many of these the NDP and Conservative opposition stripped out yesterday with their 5-4 majority on the committee.

Among them is the controversial Schedule 28 which would give the government enhanced latitude to privatize public services without returning to the legislative assembly for debate and approval.

McGuinty claims the Schedule is to facilitate the complete privatization of ServiceOntario, itself a mistake. High-profile lawyer Paul Cavalluzzo accompanied OPSEU President Warren (Smokey) Thomas to the legislative committee last week to point out that such privatization potentially opens up serious privacy concerns given U.S. subsidiaries would be forced by American law to share sensitive information gathered by ServiceOntario with the American government.

Cavalluzzo writes in a legal opinion prepared for OPSEU: “There is significant risk that a U.S. corporation or a Canadian subsidiary of a U.S. corporation carrying out ServiceOntario services under the GSSPA (Government Services and Service Providers Act, 2012) could be required by court order under the Patriot Act to produce personal records that are in their possession or control, whether those were held in the U.S. or Canada.”

If McGuinty was only concerned with ServiceOntario, why would he broaden the Act to include hospitals and other broader public sector services under Schedule 28?

In a front page news story that reads more like a pro-McGuinty editorial, the Toronto Star Queen’s Park bureau chief Robert Benzie says Dwight Duncan fears the stripping of the legislation “could cost the treasury billions of dollars by limiting privatization of public services (emphasis added).”

If Duncan truly believes privatization will save money, why would he not bring his proposals forward for scrutiny by the full legislature and by the Auditor General? Why would he feel the need to back door it through this legislation?

It’s not like the McGuinty government has not had lessons in privatization gone awry – especially in health care.

ORNGE air ambulance is still fresh in everyone’s mind as executives ran for cover under the cloak of privatization. Dr. Chris Mazza tried to hide his $1.4 million salary and other abuses through a shell game of private for-profit ORNGE subsidiaries.

Ontario has the highest percentage of for-profit private nursing home beds in Canada.  Last year there were close to 6,000 complaints and critical incidents involving residents in Ontario’s nursing homes. This is in a sector that has 77,000 beds.

Extendicare is one of the biggest players in Ontario. It has 263 senior care centres in North America with a total capacity of about 28,200 residents. In the first quarter of this year it reported $49 million in profit. Much of this profit came from its Canadian operations. Timothy Lukenda, Extendicare’s CEO, received a 26.1 per cent increase in compensation in 2011 according to the Financial Post’s CEO Scorecard. Lukenda averaged $1.4 million in compensation over two years, the same amount Dr. Mazza was excoriated for over at ORNGE. Yet there is no outrage about this. When former CEO Mel Rhinelander left the company a few years earlier he took with him $11,957,511 in severance.

Yet as these CEOs pile up their riches – much of it derived from public sector revenues – it is often the front line workers who are expected to carry the burden of restraint. When the government privatizes these kinds of services it is also accelerating the level of inequality between the Timothy Lukendas of this world and those who have to ask a manager for the key to the cabinet to be able to provide a frail and elderly nursing home resident with a dry incontinent pad.

And if the company is not publicly traded, we never get to find out how much these private for-profit companies are paying their executives. For-profit companies paid to provide public services are not required to report on the government’s Sunshine list.

Then there’s the William Osler Hospital, of which non-clinical operations and financing were privatized under the McGuinty government. The Auditor General of Ontario reported that the hospital cost Ontario taxpayers almost $400 million more than had it been built and operated under normal public procurement rules.

When York Central Hospital was hoping to save money by contracting out minor surgeries, it ended up cancelling the tendering process when none of the bidders came in below what it cost the hospital to provide the service.

This is what Dwight Duncan doesn’t want to face scrutiny about.

That’s why he snuck into his massive budget bill a clause that will allow government to simply privatize services with a stroke of a pen.

That is also why we may be headed for a summer election, like it or not.