The news that senior executives at Emera and its wholly owned, profit-protected subsidiary, Nova Scotia Power, topped their million-plus, one-per-center-club-members-in-good-standing pay packets with raises from 20 to 30 per cent last year prompts all sorts of intriguing questions.

For starters, how many of the company’s secretaries sat on the compensation committee? The short answer: none.

And how many of Emera’s little old lady shareholders clutching their 10-share legacies for their grandchildren were invited to weigh in this larcenous largesse? Ditto.

Given the usual corporate-speak, soft-shoe routine about how such increases—Emera president and CEO Chris Huskilson now tops $2.99 million, executive vice president Nancy Tower $1.4 million and Nova Scotia Power president and CEO Rob Bennett $1.15 million—simply reflect company performance, how likely is it that Emera’s 35 per cent drop in profits so far this year will show up in next year’s executive take home pay?

If you think it will, I have a Muskrat Falls hydroelectric project for sale cheap.

And, since the company’s board of directors obviously believes its top executives are worth dramatic pay increases, will it offer similar 20-30 per cent increases to its unionized work force when the next contract is up for renewal? Or will it tout the flip-side arguments: increasing fuel costs, the need for new capital investment, the general state of the real-world work economy to low-ball its waged workers. Two guesses. The first doesn’t count.

There are other questions too. How much better would Nova Scotia Power’s salt-fog, stiff-breeze, power’s-out-again response time be if it invested in hiring more linemen instead of underwriting the summer homes and sailboats of its top executives?

And one more, larger question. Why did Donald Cameron’s short-lived Tory government peddle Nova Scotia Power, then a successfully publicly-owned and operated public utility—to the private sector back in 1992.

The ostensible reason was to pay down public debt.

Our debt is higher now, and still rising.

And we no longer have a public utility that takes into account the public interest. Perhaps that was the real purpose.

One hopes there was more to last week’s Great Yellow Jesus T-Shirt Fooforaw than we now know. One hopes. Otherwise…

What we do know is that William Swinimer, 19, a Grade 12 student at Forest Heights Community School in Chester Basin, a born-again Christian and member of the Jesus the Good Shepherd Pentecostal Church in Bridgewater, wore a bright yellow T-shirt to school emblazoned with the words “Life is wasted without Jesus.”

Someone claimed the message constituted an attack on their religious beliefs.

School officials asked Swinimer not to wear it.

Swinimer kept on wearing it.

There were discussions, instructions, orders, meetings with William, his parents, his pastor, 12 days worth of in-school suspensions. Still, Swinimer wore his T-shirt… day, after day, after day. (One hopes, teenaged boys being teenaged boys, he washed it at least occasionally between wearings.)

Finally, the school suspended William for five days.

Unsurprisingly, the story leaked to the press and traveled on the weird-news wire from St. John’s to Victoria, and beyond.

While there were hints from other students the real issue wasn’t Swinimer’s T-shirt but his aggressive proselytizing—something the school would have been within its rights to suspend him for—the school board had already chosen its T-shirt to die on.

School board superintendent Nancy Pynch-Worthylake split the hairs of T-shirt reasonableness. “If I have an expression that says ‘My life is enhanced with Jesus,’ then there’s no issue with that… [but] if the shirt were to say ‘Without Jesus, your life is a complete waste,’ then that’s clear that it is an opinion aimed at somebody else’s belief.”

Uh…

Unsurprisingly, everyone from a national atheists organization to Tory leader Jamie Baillie found cameras before which to declare their support for Swinimer’s inalienable right to bear his religion on his chest.

Finally, mercifully, on Friday, the school board backed down.

Swinimer will be allowed to return to school today with his T-shirt intact. The school board now claims it was never about “the one shirt” and will spend today meeting with students and parents about “expressing beliefs in a complex multicultural school environment.”

All’s well that ends.

Last week’s to-the-edge-of-the-ledge, past-the-last-minute contract settlement between Capital Health and its 3,600 health workers raises all sorts of difficult but intriguing questions.

The first, and most immediate, of course, is could the disruption—even without an actual strike, the anticipation cancelled 560 elective surgeries and emptied 172 beds—have been avoided?

The short answer is probably not. Both sides have legitimate, vital interests in the outcome and only the combined pressure of a looming deadline and smacking up against the real-life consequences of not settling creates the conditions necessary for compromise.

So long as there is collective bargaining, we will have brinkmanship.

But should we even have collective bargaining in health care? Let’s come back to that.

Is the settlement fair? We won’t know the full financial implications until an arbitrator picks either the union’s (nine per cent over three years) or the province’s (6.5 per cent) final position. The province’s finance department has undoubtedly already crunched both scenarios, so Premier Darrell Dexter should disclose them so we can discuss their merits now.

This year’s provincial budget includes a $199-million “restructuring” line item, supposedly to cover contract settlement contingencies above the government’s hoped-for one per cent salary increases, so the deal may not deflect the government’s goal of balancing the books by next year. But it will raise the bar for other public sector workers.

Other numbers also come into play when asking if the settlement makes sense. Nova Scotians’ cost of living increased by 3.7 per cent last year while wage settlements barely nudged 0.4 per cent. Even the union’s final demand just keeps pace with cost-of-living increases.

One more, different set of “numbers:” the settlement calls for an across-the-board wage increase, meaning those at the lowest end of the union’s 100 or so different job categories—those who need more most—will get the least. How fair is that?

Back to collective bargaining and essential services. Given that the final salary settlement ended up in the hands of an arbitrator anyway, why not cut to the chase and ban strikes in health care?

That, my friend, is a whole other discussion. What do you think?
 

Is it time for another “Encounter on the Urban Environment”?

In late February 1970, Nova Scotia’s Voluntary Planning Board invited a dozen disparate international experts—a black community leader, an industrialist, a labour leader, a journalist, an economist, an urban planner, etc.—to come to Halifax for a week-long “experiment utterly new to the western hemisphere.”

“Their assignment, although it was never explained to the 12 in precisely these terms,” noted a later report, “was to take a community of 250,000 and turn it upside down.”

They did. Given the freedom of the city, they spent long days and longer nights wandering from the Volvo auto assembly plant (Why are no blacks working here?) to the new container pier (Why is it in the wrong part of town?) to the school board office (Why is the education system so awful?) to the press club (Why is the media even worse?)…

Each evening, they staged a live televised town hall where they argued, debated, questioned, cajoled, harangued and listened to anyone who showed up. The powerless got to speak to the powerful and the powerful—in the glare of the spotlight—responded.

While the final Encounter report—cobbled together by 12 very different people between meetings, visits and late-night drinks over the course of one exhausting week—was understandably less than the sum of its parts, the process itself galvanized the city and engaged Haligonians in ways they’ve never been since.

Halifax at the time was at a crossroads, unhappy with its parochial present, trying to find a more interesting future for itself.

Although it would be unwise to heap too much credit on Encounter—the times were a changing everywhere back then—the reality is that Halifax became a much more interesting, engaged and dynamic city in the years that followed Encounter.

We could use a little of that involvement today.

Now that polarizing Peter Kelly’s decision not to re-offer for mayor has sucked the life out of what might have been a real debate over the future of our city, we need to find new ways to engage citizens in that discussion.

We could do worse than another Encounter.
 

Why don’t we cut to the chase? Is it time to eliminate elected school boards and let the provincial government shoulder real responsibility/blame/credit for how our schools are operated/paid for?

I ask, in part, because of last week’s dust-up between the Chignecto-Central school board and Premier Darrell Dexter and Education Minister Ramona Jennex.

Earlier this month, the board announced that—in order to meet a provincially mandated 1.7 per cent budget reduction, not to mention contracted wage increases and inflation—it was eliminating every one of its 41 librarian positions.

“We had nowhere else to go,” the board chair said.

In the legislature last week, Dexter shot back the board was playing a “political game” to “scare” parents and “embarrass” the government.

There was money for the librarians, he said.

The next day, Jennex—while piously declaring “our school boards are in the best position to know the unique needs of their communities”—nonetheless announced she’d ordered the board “not to finalize their proposed budget cuts, pending an immediate provincial review.”

This is far from the first time a Nova Scotia government has stepped in when it didn’t like something one of our eight elected school boards was doing. In fact, since 2006, two different provincial governments have fired three different school boards.

So what’s the point of having elected boards at all?

Theoretically, local boards provide opportunities for community involvement and control over what is one of our most important public institutions.

Practically, however, the province not only controls the board’s purse strings but also makes all the big-ticket spending decisions—teacher salaries, pension plans, etc.—and then tell the boards to make it work.

Given the NDP’s commitment to balancing its books by next year coupled with the demographic reality that declining student numbers are hollowing out school districts, the education budget becomes an inviting target for government cost-cutters.

That added advantage—from the province’s point of view—is that it downloads responsibility for making the toughest decisions to local school boards.

Unless, of course, it doesn’t like what they decide. And then…

It’s time to rethink how we run our school system.

The thing I don’t understand—one of many actually, but let’s start with this one—is whatever happened to the debt?

Whenever governments decide to put us on short rations—as the NDP did after it came to power in 2009, as the federal Liberals did in the 1990s—they do their best to frighten us into submission with the double-whammy bogeymen of unsustainable annual deficits and future-defying, long-term debt walls.

But then, as soon as they tame the former, they quickly forget the latter lives on.

How else to explain Darrell Dexter’s pre-budget good-news announcement last week? The province is declaring a balanced-budget dividend and will soon begin lowering the HST it raised to slay the deficit dragon Not to forget eliminating the large corporation tax, cutting the small business tax and throwing in a few tax-credit bones for good measure.

Tucked in a forgotten drawer of the next day’s budget speech was the reality that, despite declining annual deficits, the province’s net direct debt will actually increase from $13.3 to $13.7 billion by the end of the coming fiscal year.

That represents a $14,547 hobble for everyone of us, infants and the elderly included. And paying just the interest—$881 million a year, or about 10 per cent of what government departments spend on actual services—“crowds out government activities from sectors that it should be more active in, from education to social welfare to economic development,” as the government’s blue-ribbon economic panel of economic advisors succinctly put it back in 2009.

The NDP isn’t alone in ignoring the debt.

Tory leader Jamie Baillie, who hasn’t met a tax he wouldn’t cut, was puppy eager to slash the HST deeper and faster. Oh, yes, and balance the budget yesterday too. Debt? What debt?

Liberal leader Stephen McNeil wants the government to cut the gasoline tax.

Business leaders—who pretend they know how to read a balance sheet—clamoured for even more tax cuts… for themselves.

No one, it seems, wants to talk about the debt. Or, alternatively, restoring some of the public services cut in the name of restraint.

And so the debt grows. Until the next time a government needs to scare us with an  even bigger bogeyman.
 

In the all-too-brief interregnum between Thursday’s bad-news federal budget and tomorrow’s more-bad-news provincial budget, it’s worth noting the across-the-board, cost-cutting Kool Aid fiscal policy makers in Ottawa and Halifax have swallowed is not the only—or necessarily best—way to slay the deficit dragon.

The Nova Scotia branch of the Canadian Centre for Policy Alternatives, for example, a progressive think tank, recently released its annual alternative provincial budget. Its “Forward to Fairness” document calls for “strategic investments” while finding “creative ways to save money and increase revenue.” Instead of rushing to balance the budget in 2013-14 “to fit the timing of the electoral cycle,” the CCPA wants the government to stretch the back-to-balance timetable to 2015-16 to “reflect the actual fiscal situation.”

“Austerity does not come for free,” says the CCPA’s Nova Scotia director, Christine Saulnier. The CCPA says the government’s decision to cut $772 million in public spending over four years will mean the loss of “well over 10,000 jobs.”

By contrast, the CCPA’s approach involves investing $492.5 million in social infrastructure and programs, including everything from $40 million to establish 10 new community health centres, fund 10 more nurse practitioners and 12 more midwives, to $45 million to phase in an early learning and child care system and $21 million for rural public transit.

Where would the money come from to pay for all of this. Primarily by shifting the tax burden, says the CCPA, from low and middle-income taxpayers “to the upper 45 per cent of income earners, especially the top 10 per cent,” those who have gained the most in the past decade.

Graham Steele

Don’t expect to hear any of this on Tuesday. While the CCPA had what Saulnier calls “a serious and engaged exchange” with Finance Minister Graham Steeele, the finance department “has framed the problem and the solutions in a way that precludes our proposals. In other words, they see declining enrollment in P-12 as a way to justify cutting; we see it as an opportunity to finally catch up with the rest of Canada and begin to really address quality.”

Pity.

The stadium is dead. Long live the dream. But let’s keep it a dream instead of the reality turning into a taxpayers’ nightmare.

A brief history is in order. Peter Kelly, our in-search-of-a-legacy-to-match-his-longevity mayor, has long been eager to have the city to erect an expensive new stadium, most recently—and urgently—in the faint hope we might somehow complete it in time to host a few FIFA Women’s World Cup soccer matches in 2015.

Keep in mind Kelly previously tried to saddle us with that costly Commonwealth Games white elephant. And still wants us to invest in his convention centre fantasy.

After feasibility studies and consultations, not to forget a pretty-please, deadline extension request for our FIFA bid, council asked staff in December to report on what it would take to build a stadium in time for the World Cup events. Including, of course, identifying who else might be willing to share in its $60 million construction cost.

Oops.

According to the report, staff consulted widely with their provincial counterparts, prepared detailed information packages for all MLAs, met with both opposition leaders and even sat down face to face twice with Premier Darrel Dexter.

In the end, the province decided the city hadn’t presented “a business case... to support a provincial investment.”

The city enlisted Nova Scotia’s federal minister and stadium booster Peter MacKay. But even MacKay’s cabinet clout wasn’t enough to convince his ministerial colleagues to pour federal cash into the project.

Which left the private sector. Last month, the city asked for “expressions of interest” from private developers. Seven made submissions. Only three offered potential “partnership opportunities,” staff reported, and none included “any cash value.”

Logically, staff is now recommending council just say no to building a stadium at this time.

Kelly, who told Metro’s Jennifer Taplin he’s “an eternal optimist,” was disappointed but still hopeful the project could go ahead in “years, not decades.”

The stadium, it’s worth noting, will never pay for itself and will be a continuing operating drain on city taxpayers, regardless of who shares in its capital costs.

So I hope he’s wrong.

Now that transit buses are transiting the city and ferries finally ferrying passengers, let’s take one last, un-fond look back at what went wrong and where we go from here.

To begin with the obvious: problems at Metro transit predate—and go much deeper than—this latest dispute. Metro Transit is over-managed and under-performing, neither of which is the fault of the drivers, or even the previous contract.

Going into negotiations, management believed it needed to transform the traditional scheduling system to reduce overtime. But it appears they made few meaningful efforts to engage their employees in developing a better system prior to issuing their take-it-or-leave-it contract edict.

Metro Transit—in its unseemly haste to breeze past the formalities of offer, counter-offer, non-counter-offer and conciliation with little real bargaining—seems to have been spoiling for a grind-them-down strike from the beginning.

And Metro Transit did an abysmal job of explaining its side of “rostering,” the issue it deemed central to the dispute.

Then again, so did the union.

Which left the public with little understanding of why they suddenly didn’t have a bus service.

To say neither side distinguished itself during the strike is an understatement.

The union squandered what little public support it had—public sector workers are everyone’s favourite whipping boys these days—with its ill-advised decision to block, even briefly, management-driven Access-a-Buses. The drivers then compounded that faux pas by blocking—again only briefly—snow plow operators.

While one can understand their frustrations, the reality is the union needed public support to pressure city council to bargain in better faith.

They didn’t get it.

The deal they got—a promise Metro Transit will consult instead of simply imposing a new scheduling system—isn’t what either side wanted.

But it does offer the possibility of a fresh start.

Management must recognize its workers have a role in making bus service more efficient—they may have a few suggestions for which managers can go!—and the workers need to recognize they can’t just cling to the past.

Luckily, they now have five years to make it work.

On Dec. 14, 2011, Sobeys announced it was swallowing whole every one of Shell Canada’s 250 service stations east of Ontario.

No big deal. The day before, Empire, which controls the Canadian super-sized supermarket chain, had reported a quarterly profit of $78.1 million. Sobeys had the cash to buy whatever it wanted. Buying Shell’s stations offered the company “an exciting opportunity” to expand its own already expanding retail gas bar-convenience store network. Fair enough.

What was most interesting about the deal, however, was what was unsaid. Twenty-three of the service stations were in Nova Scotia.

Nova Scotia?

Five days before, the Nova Scotia legislature had passed “totally unnecessary” legislation Sobeys that declared would “do serious damage” to the province’s business investment climate. During a rare appearance before the legislature’s law amendments committee, the company hinted ominously that if the government passed its proposed business-busting bill, it would . . . well, “affect” how Sobeys (Nova Scotia’s largest retail employer) did business in its native province.

Take that, Darrell Dexter!

What had the NDP government done to wrap Sobeys’ knickers in a knot?

The legislation, known as Bill 102, provides for something called first-contract arbitration. It’s specifically tailored for those rare situations when newly unionized workers and their employers can’t reach a first contract themselves — perhaps because the employer refuses to negotiate, or the union demands the moon, or the company and workers simply aren’t used to bargaining collectively. If the two sides can’t settle their differences in a reasonable time, an arbitrator can impose a one-time contract.

Such legislation is commonplace. The first first-contract arbitration law in Canada was passed in British Columbia in 1974. “Employer-unfriendly” B.C., of course, is where Sobeys spent $260 million to buy up a rival supermarket chain in 2007. And Quebec — where most of Sobeys new Shell stations are located — has had such legislation since 1978.

Today, six provinces and the federal government all have some form of first-contract arbitration. Eighty per cent of Canadian workers, including the 15 per cent of Nova Scotians employed in federally regulated enterprises, are covered.

Those laws haven’t, as its Chicken-Little critics contend, encouraged workers to recklessly embrace evil unions. Canada’s unionization rate has been declining in every province for decades.

The law is rarely used. In Manitoba (the province on which Nova Scotia’s legislation is based), there were just six applications for first-contract arbitration from 42 newly unionized workplaces in 2009-10. Only two of those resulted in imposed contracts.

In fact, studies show the mere existence of legislation increases the chances of a negotiated contract and reduces work stoppages by a “statistically significant” 65 per cent. Not a bad outcome, surely.

And it isn’t just unhappy unions that apply. In British Columbia, fully one-third of arbitration applications come from employers.

So . . . why did Nova Scotia businesses wail “wolf” over first-contract arbitration?

“Fundamentally, every employer needs to be in the position of determining wages, benefits and working conditions,” the Nova Scotia Employers’ Roundtable says. A consortium of 21 of the province’s most powerful non-union employers (including Sobeys, Michelin, Irving, Nova Scotia Power, Wal-Mart Canada, Killam Properties and Oxford Frozen Foods), it wrote a lecturing letter to Nova Scotia Premier Darrell Dexter last Fall insisting that companies alone “ultimately have the right to say ‘no’ if it in good faith considers that doing otherwise would adversely impact its interests.” (They apparently haven’t read Section 2(d) of Canada’s Charter of Rights and Freedoms, which includes collective bargaining rights, but that’s another story.)

Businesses want governments to butt out of their business — except when they don’t. Then they want governments to do their bidding.

In Nova Scotia, for example, where employers have traditionally wielded unfettered control over their workplaces, powerful, and powerfully anti-union companies like Michelin have been able to bully governments on several occasions to rewrite provincial labour laws to make it impossible for the company’s workers to organize, let alone bargain for a first contract. Those laws are still on the books.

First-contract legislation is now law. Will companies like Sobeys stop investing because of it? Will the union hordes descend? Will the sky fall? Stay tuned, but don’t hold your breath.

From the March/April 2012 issue of Atlantic Business Magazine.