Obama said in his recent speech in Berlin:

“In the United States, we have recently doubled our renewable energy from clean sources like wind and solar power. We’re doubling fuel efficiency on our cars. Our dangerous carbon emissions have come down. But we know we have to do more — and we will do more.”

Lomborg sums up the actual facts:

In Berlin, Obama proudly confirmed the US has reduced its CO₂ emissions, but entirely neglected to say why: because of US fracking.

The doubling of wind and solar may have reduced CO₂ by 27Mt/yr but the total US reduction is about 800Mt/year, with fracking responsible for 400-500Mt and the recession the rest.

It’s also not a real doubling of vehicle efficient, it’s a projected doubling by 2025:

The doubling of fuel efficiency has done almost nothing; it only reaches a doubling in 2025. Right now there has been just 11% increase in efficiency, which if *nothing* else changed would translate into a reduction of 121Mt/yr, but most of the efficiency is likely to be translated into longer trips and expenses on other carbon-emitting consumption.

A good reminder to check results, not just aspirations, when listening to politicians:

Everyone likes to talk about solar, wind and efficiency, but in reality, these only make up a very small fraction of what can be reduced through fracking. Only talking about ineffective levers means we’ll continue to only enact ineffective climate policies.

Obama would do better telling the straight story.

Hydro has sold power to Saskatchewan for years, but the quantity has been low, with the flow restricted by the capacity of the transmission lines between the two provinces. Discussions between energy rich (coal and gas included) Saskatchewan and Manitoba have gone on for years, without any major transaction resulting. Recognizing the transmission capacity limitations, Premier Selinger has been quoted as saying Saskatchewan’s current interest could potentially rely on existing transmission lines ‘with modest improvements’.

Publius suspects it would take far more than ‘modest improvements’ to existing transmission lines to support a major sale of additional power to Saskatchewan, and in the absence of a very major sale would neither require Keeyask or Conawapa (nor Bipole III).

Before visions of ‘sugar plum fairies’ form in the minds of Manitobans, details of any proposed sales (duration, timing, rates, volumes, terms including renewal terms, etc.), along with the implications for supply (cost, options, risks) and domestic rates, need to be carefully and expertly vetted.

It may also be instructive for Manitobans to consider the past ‘visions’ of government associated with Manitoba Hydro that have not worked out as originally forecast:

The 1980s aborted sale to Ontario Hydro (development losses incurred by both Ontario  and Manitoba Hydro); Wuskwatim (final cost, twice the estimate; receipts, half the forecast); the Doer government’s plans for Hydro’s wind development (the 2,000 MW then sought now apparently restricted to the existing 300, those largely financed by Hydro and supported by expensive long-term contracts); the purchase of Winnipeg Hydro and Centra Gas (Hydro over-paid);  the original cost projections for Bipole III, Keeyask and Conawapa (now doubled, more increases to come); Hydro’s past forecasts of export prices and volumes (spot prices now half, if that; volumes lower); Hydro’s original term sheet with Wisconsin Power (sliced back from 500 MW to 100 MW, able to be served by existing transmission lines); Hydro’s past forecasts of industrial load demand (plant and unit closures have taken more than a decade of expected growth ‘off the table’); 20-year domestic rate forecasts from 2004 (now doubled, likely to go even higher); Hydro’s forecast that the additional annual costs associated with its new head office would be met by ‘efficiencies’, complement reductions (complement has soared). etc.

The forecasting record of government and Hydro with respect to Hydro has been, to be fair, far from stellar if not simply ‘awful’. The record is so bad that the Utility and its sole shareholder’s (the government) forecast credibility has to be called into question.

Publius remains skeptical about the wisdom of virtually every aspect of the government-driven development plans for Manitoba Hydro, and ratepayers should be as well.

Before Bipole III proceeds, and before further millions and billions of borrowed money is spent on a plan that could lead to a tripling of domestic rates (with the increases spun out over two decades to reduce public outrage), a truly independent expert review needs to be conducted (not a sham NFAT).

The review is needed now for the full development plan,  including Bipole III. All the options need to be considered, and with ‘all the cards’ on the table.

The ratepayers are the party at risk, being called on to ‘carry the full load’. They deserve to know everything.  And, difficult as it may be, if the plans cannot stand up to a proper and open scrutiny, they should be changed (even if write-downs are required and commitments have to be withdrawn).

Publius

few others) for intervener status at its upcoming fall 2013 Needs for and Alternatives To (NFAT) review of the government’s plans for the construction of two new hydro-electric dams (Keeyask and Conawapa). The NFAT is part of the government’s ‘full speed ahead’ and ‘dam the torpedoes’ approach to its Hydro development plans.

Publius, for the reasons set out  below, shares former PUB Chair Graham Lane’s description of the planned NFAT, it is, as he has said, a sham. (Also, see a previous Publius post: “Show Trial on the Red”).

In  fact, there has been considerable and appropriate criticism of the upcoming review.

The criticism has several dimensions – timing (the review will come well after a billion or more has already been spent by Hydro on the overall development plan, along with commitments made to First Nations, American utilities, trainee Hydro employees, etc.); restrictions on PUB’s mandate (government has determined that PUB will not review or question either the construction of Bipole III,  which, it seems evident, is to be undertaken ‘come hell or high water’; contracts entered into by Hydro with First Nations to share ownership in the dams; or, transparently review Hydro’s export contracts and term sheets, despite the fact that the ultimate party at risk is Hydro’s ratepayers and the Province’s taxpayers); the lack of independence of government represented in the persons of the PUB panel, all appointed by government; the cost (lawyers, consultants, interveners and advocates will likely bill millions before the review is completed, costs that will be eventually reflected in Hydro’s monthly electricity bills to ratepayers  - this following a quarter of billion and more dollars that have previously been spent by Hydro on lawyers, consultants and projects to gain First Nation cooperation, all related to the current development plan); and, prejudicial (to PUB’s NFAT) statements made and repeated again and again by the Premier and his Cabinet colleagues before the review even begins (indicating that the overall Hydro development plan, currently forecast to cost $33 billion over twenty years, will proceed).

All of this ‘activity’ should not divert ratepayer/taxpayer attention from Hydro’s major concurrent activity, that being proceeding with plans and expenses for and related to a west-side routed Bipole III.  Just as is the case with the overall development plan, Bipole III has also come under heavy criticism, and, once again, the criticism is warranted, and hasn’t been effectively responded to.

Arguments solidly-based on changes that have occurred in the economy and in Hydro’s market area since government arrived at its stupendously expensive plans for the Crown-owned monopoly call for, at the least and most immediate, a deferral of Bipole III.

The case has been made that there are alternatives available to the current development plan, alternatives that could materially reduce Hydro production costs, future Hydro rate increases, and the overall risks associated with the development plan, alternatives available, less costly and less risk for the benefit of ratepayers, taxpayers and the provincial economy.

No more should be spent on Bipole III until a proper, expert and independent review of the overall development plan and options thereto has taken place.

The government’s strategy is to build Bipole III come ‘hell or high  water’  – avoiding criticism as best as possible by preventing even its own agency’s (PUB’s) NFAT review from questioning it, because, in part, once Bipole III is built the government’s case for another hydro-electric dam is, at least on face value, made stronger.

And, without Bipole III there will be no further new northern dams built over the near to mid-term. (The last one, Wuskwatim, ended up costing twice the estimates made just before construction began, while is delivering half the revenue it was expected to produce – losses of $100 million a year are projected (each $100 million is equivalent to a 8% rate increase).

Without another hydro-electric dam, increased electricity exports to the United States (at the low prices the market allows, spot prices being one-third to one-quarter of the marginal cost to produce) , another First Nation partnership (the current one is being revamped because it produces losses for the First Nation, not the promised profits) , the hiring of hundreds if not thousands of new employees, the engaging of contractors and manufacturers required to build the dams, and huge additional revenue flows to the government’s Consolidated Fund will not occur.

While proceeding with the present plan can be expected to meet the government’s objectives, see above, the parties at ultimate risk remain the ratepayers and taxpayers of this Province. It is the ratepayers that, even based solely on Hydro’s current projections, will be required to pay much higher rates and carry the risk of even worse results developing over time.

The ‘Show Trial on the Red’ (PUB’s upcoming NFAT) should be put on the back burner, as should be the construction of Bipole III. There are just too many doubts and risks, too many unanswered questions, and lack of penetrating analyses produced by independent experts. Once built, Bipole III cannot be ‘repealed’, and the risk is too high to proceed ahead of the entire plan being dissected expertly, transparently, and comprehensively.

If a proper review led to a deferral, cancellation or major revamp of the government’s plans, it must be  know that there would be consequences. These could include charges against the government’s own summary accounts as intangible and deferred assets and costs now carried on Hydro’s books were written down. Painful as such a circumstance would be, for taxpayers as well if it affected core service delivery, the twin mantras (‘your first loss is your best loss’, and, ’don’t put good money after bad’) are often true.

The ratepayers and taxpayers of Manitoba should not be put at risk by a  commercial adventure insufficiently supported by proper analyses being undertaken by a monopoly directed by a conflicted government.

The most immediately needed action is to put Bipole III on hold.

The Commission aims to develop some Aboriginal policy positions and influence the direction of the Liberal Party.

This is an historic opportunity for the Liberal Party to adopt some forward-looking Aboriginal policy proposals.

Some suggestions would be first and foremost to endorse a First Nations Property Ownership Act, as developed by Manny Jules of the First Nations Tax Commission.

This Act would transfer underlying title to reserve lands to First Nations governments. If bands choose, they can then transfer land to individuals in fee simple, the strongest and most common form of land ownership in Canada.

The Conservatives have announced their support for this kind of legislation, but improving First Nations communities by allowing them to maximize their assets is a non-partisan issue.

The party should also ensure it fills the education gap on many First Nations. Currently, the Indian Act is silent on educational standards. First Nations need a modern education act that emphasizes accountability for results. The model should also allow for parental choice within the system.

The Liberal  Party should also stand behind policies that emphasize governance reform for First Nations. The data points to a strong connection between good governance and improved economic performance.

On this note, the party should support funds for more First Nations to enter the First Nations Land Management Act (FNLMA). The FNLMA allows bands to opt out of the land management provisions of the Indian Act. Data shows that bands within the FNLMA perform better economically.

The Liberals should also stand behind First Nations transparency and accountability, as included in the First Nations Financial Transparency Act.

The party needs to move towards proven, results-driven policy and away from the increased funding,  no strings attached model of the past.

Fortunately, I came across a video from Ted Talks, in which Louise Fresco, a former UN director, puts the spread of mass produced bread into context. She points out that while mechanized agriculture is unpopular among many elites, it has drastically increased food production (and lowered costs), while freeing up citizens in developed countries to do other types of work. Moreover, it saves them from the backbreaking labour of manually planting and harvesting crops.

Fresco goes on to point out the errors of the push back against large scale food production:

Now it is not surprising that with this massification and large-scale production, there is a counter-movement that emerged — very much also here in California. The counter-movement says, “Let’s go back to this. Let’s go back to traditional farming. Let’s go back to small-scale, to farmers’ markets, small bakeries and all that.” Wonderful. Don’t we all agree? I certainly agree. I would love to go back to Tuscany to this kind of traditional setting, gastronomy, good food. But this is a fallacy. And the fallacy comes from idealizing a past that we have forgotten about.

If we do this, if we want to stay with traditional small-scale farming we are going, actually, to relegate these poor farmers and their husbands — among whom I have lived for many years, working without electricity and water, to try to improve their food production — we relegate them to poverty. What they want are implements to increase their production: something to fertilize the soil, something to protect their crop and to bring it to a market. It’s a luxury solution for us who can afford it, if you want to afford it. In fact we do not want this poor woman to work the land like this. If we say just small-scale production, as is the tendency here, to go back to local food means that a poor man like Hans Rosling cannot even eat oranges anymore because in Scandinavia we don’t have oranges. So local food production is out. But also we do not want to relegate to poverty in the rural areas. And we do not want to relegate the urban poor to starvation. So we must find other solutions.

I encourage you to watch the full video. It provides much needed perspective in a debate that is too often dominated by well meaning upper class westerners who cannot fathom the struggles of the world’s poorest citizens.

Publius

politicians, lawyers and accountants brought about the credit crisis and the worst recession in the developed world since the 1930s.

Politicians strive to be elected and, when in power, to stay in power, and the professions, legal and accounting, serve the politicians through the practice of their art.

At one time, government accounts were kept on a ’cash basis’, if a government had a road built, that was an expense and went against the government’s revenue of the year in the determination of whether that government had achieved a ‘surplus’ or incurred a ‘deficit’. This approach tended to restrain government expenditures and borrowing.

Two decades ago and since, government accounting ’moved’ closer to the approach of the commercial world. Spending on ‘infrastructure’ (roads, buildings, equipment, etc.) became ‘investments in capital assets’, to be charged against government’s revenue over the expected service lives of the assets. Assets acquired through borrowing are now ‘expensed’ over decades. Depreciation accounting came to government.

While there are strong arguments for the-then new approach, now well ingrained at the federal, provincial and municipal level, it does facilitate the growth of debt, as borrowing is not a charge against current revenue, only, and not necessarily all of it, the interest on the debt.

So, now what we have is revenue flowing into the coffers of the Government of Manitoba as it is received, while ‘costs’ against that revenue represent both ‘current period’ costs and the year’s amortization of past infrastructure ‘investments’. When government says it is raising taxes to pay for new infrastructure, it fails to note that while the higher tax revenue flows into its account in the year of receipt, the ‘expense’ of the infrastructure occurs over many years, decades in most cases.

The ‘new’ approach,  while consistent with the accounting long in place for private enterprise, allows for ‘stimulus’ and other funding that doesn’t drive up the government’s current period deficit.

Of course, as the aggregate investment in depreciable assets grows, the ‘wiggle room’ for future governments is reduced, as amortization of past investments are charged against current period income.  And, the ability and desire of government to borrow now and ‘pay later’, so to speak, increases when interest rates are low, which while being the current situation likely will not persist for much longer.

The Government of Manitoba ‘owns’ Crown corporations, and makes assessments or charges against those Crown enterprises for various services and purposes (such as the charges made by the government against Manitoba Hydro for capital tax and the fees the government charges for ‘guaranteeing’ Hydro’s debt).

By the way, the guarantee of the government soothes the concerns of credit rating agencies and the buyers of government bonds, though the prospect of actually calling on the guarantee is miniscule, as the government has every intention to have utility ratepayers meet every cost incurred by the utility, including levies against the utility by the government.

The interesting fact is that while the government takes those levies it makes against Manitoba Hydro into income in the year the government makes and receives those charges, Hydro, in its books, doesn’t always record those charges as an expense against its revenue. When part of the capital tax levy and part of the debt guarantee fees charged by the government against Hydro have to do with Hydro’s infrastructure projects, projects that are neither finished nor ‘in service’, Hydro ‘defers’ those costs in its books.

In such a situation in the commercial world, where the controlling corporation levies charges against a subsidiary, the recognition of that revenue in the controlling corporation’s books takes place in synch with the expensing of those charges in the books of the subsidiary. The ‘consolidated result’ published for investors eliminates charges between affiliated companies. In the commercial world, if the subsidiary doesn’t expense the charges made by the parent company in its books, the parent, in its own books, cannot record the income.

That  has not been the case with the books of the Government of Manitoba and Manitoba Hydro. Before Manitoba Hydro begins to expense levies made by the government related to ‘construction in progress’ (capital tax, debt guarantee fees), the government will have recorded revenue in its annual accounts aggregating in the hundreds of millions, likely low billions in the end.

This approach ‘assumes’ that, in the end, Hydro will expense those levies in full, and that ratepayers will meet those costs in higher rates. Of course, the Utility’s recording of the expenses in its current period books and the approval of increases in consumer rates to offset those expenses may not occur for a decade.

(Technically, the levies made by government against Hydro cannot be ‘assumed’ to be reflected,  in the end, in higher rates for consumers, as the rate regulator, expected to follow generally accepted rate setting practices, can only accept into rates costs that it finds prudent.)

This situation needs to be reflected upon, more to come in a subsequent post.

The Code includes using plain language and other measures to ensure that consumers know what their contract means and what their service includes.  It is rather telling that this is deemed to be necessary.  Other parts of the Code deal with disconnection rules, lost or stolen phones, repairs, unlocking, premium services, security deposits, changes in contracts, expiration of prepaid cards and a few other matters.

The 3-year contract is, in effect, limited to 2 years although suppliers can continue to offer them.  The handset subsidy, however, must be calculated to expire in 24 months and no other early cancellation fee can be charged in addition to the remainder of the handset subsidy.

There are limits to roaming fees in any given month and limits on overage charges in data plans as well as a requirement to notify the customer when international roaming charges are kicking in that includes the rates that will apply.  This is intended to reduce instances of “bill shock”, that occurs when people get a $2000 bill after returning from a trip to the U.S. or overseas.

Some commentators have described the Code as another assault on free markets.  See, for example,

http://opinion.financialpost.com/2013/06/04/crtc-kills-three-year-contracts-in-latest-futile-attack-on-the-wireless-industry/

Far from being an attack on the wireless industry, the wireless industry itself requested the CRTC to create a Wireless Industry Code of Conduct, to protect it from a host of provincial legislative initiatives.  The wireless industry has managed to get consumers so upset that provinces were starting to impose legislation.

This came about as a result of genuine grass roots anger over poor treatment, not just cynical manipulation of the system by consumer lobby groups.  The wireless industry has exhibited classic oligopoly behaviour with high prices, lots of advertising and specious product differentiation.  Prices fell dramatically when Wind and Mobilicity were licensed.

Anyone who has ever tried to set up a spreadsheet and do comparative shopping will remember that you cannot do that effectively because the offerings are not comparable and are constantly changing (specious product differentiation).  Some consumers recall getting conflicting information from the same company’s call centres, web sites and retail outlets and misleading promotions when their 3-year contract is about to expire.

Frankly it boggles the mind that large companies in Canada have to be regulated into this at their own request.  Most of it would seem to flow from the concept of treating the customer with respect.  But if the only impact of poor customer services is that every month a number of angry Rogers customers move to Bell that replace their angry customers who moved to Telus that replace their angry customers who moved to Rogers ad infinitum, then it did not really matter.

Many people have a mobile phone through their employer and are thereby protected from these experiences.  Corporate and government administrative service units are paid to figure out the contracts and the larger accounts have more negotiating power.

Reducing the 3-year contract to 2 years is a Solomon-like decision.  I would have preferred them to do away with it entirely.  But at least this reduces the ability of the incumbents to use the 3-year contract and the handset subsidy to prevent customers from moving to new competitors.  It limits their most important anti-competitive tool.

N.B.  The author consults to Ice Wireless, a wireless competitor in Canada’s north.

The Assembly of First Nations (AFN), for example, will see its project funding reduced by 30 per cent.

The AFN and other organizations are already expressing frustration with the cuts. AFN National Chief Shawn Atleo said they undermine the “potential for progress.”

The government, has said the cuts will allow Aboriginal organizations to focus on projects with clear results and will help avoid duplication.

As stated in this past Frontier Centre column, Aboriginal political organizations do not provide front line services in First Nations communities. They are essentially lobby groups, and First Nations leadership-driven ones at that.

Thus, these cuts should cause these organizations to re-think their project priorities.

Perhaps Aboriginal Affairs could channel those dollars into new education and economic development initiatives that will greatly benefit the grassroots.

There is no evidence that these cuts will undermine progress. That is more about good will and compromise than project dollar amounts.

In an address of about three quarters of an hour, Mr. Lane shared serious concerns about the provincial government’s determination to have Manitoba Hydro (a Crown corporation with a monopoly over electricity and natural gas supply in Manitoba) enter into long-term electricity export contracts with American utilities and partnerships with northern First Nations, requiring, at great cost, the building of  two new hydro-electric generation stations and Bipole III.

Noting the projected costs of Hydro’s overall capital expenditure plan, that now being $33 billion, apparently three times Hydro’s current balance sheet, Lane forecast the potential for very major rate increases lying ahead for Manitoba  ratepayers, rate increases high enough to bring about energy poverty for lower  income households and risk general economic disruption.

He also criticized the absence of Auditor General reviews of both Hydro’s expenditures (and contract terms) to attract the Utility’s First Nation partners and allegations of a ‘whistleblower’ (previously an advisor to Hydro). It has been reported that the Auditor General, who has recently indicated her  intention to retire ahead of the end of her contract term, was, previously, a member of  the Board of Directors of Hydro.

Lane cited a lack of openness and transparency by both the provincial government and Hydro, and derided the planned involvement of the agency he previously led, PUB, in what he called a sham review of government’s plans. He noted the changed economic environment that have developed since the plans were developed, and criticized government and Hydro resistance to reconsider their development plans, despite evident risks for ratepayers.

Following Lane’s address, a vocal defence of the plans emanated from the Minister Responsible for Hydro (Mr. Chomiak) and the Premier (Mr. Selinger), a defence while loud in ‘anger’ devoid of substance. A similar,  devoid of substance but calmer, written defence of the questionable plans has now been provided by Hydro’s President (by way of an article published in the Winnipeg Free Press).

Neither Chomiak, Selinger  nor Thomas have addressed many of Lane’s concerns, and the ones they did address they have failed to do so in adequate detail or with evidential support.

None of the three respondents answered Lane’s criticism of needed audits not being undertaken because of the recusal of the Auditor General from reviewing Hydro actions and plans, the ongoing spending ahead of the planned review.  Nor did they respond to the specific rate forecasts offered by Lane.

None of the respondents questioned Lane’s rendition of Hydro’s previous poor forecasting of construction costs, export sale prices and industrial demand forecasts. None addressed Lane’s concern about the lack of diversified supply, and the risks that thus lie with future droughts. None addressed the risk for existing ratepayers of new or expanded ‘power hog’ industries being allowed large industry rates that are one-third, if not less, of the marginal cost of new supply.

None spoke of the restrictions placed on the apparently upcoming PUB review of Hydro’s already well-underway plans – PUB apparently cannot consider the disaster that is the Wuskwatim experience, or review the expenses incurred and contracts entered into with First Nations, or even question the necessity and implications of Bipole III (and the route laid out for it).

None acknowledged Lane’s concerns about the non-competitive and secret processes surrounding the appointment of Hydro directors and PUB members, raising the risk of conflicts of interest.  Nor did any of them counter Lane’s assertion that during the planned ‘build phase’ of  Hydro’s plans, government will reap hundreds of millions of dollars from capital tax and debt guarantee fees, the aggregate likely accumulating into the billions before the build is complete, costs that Hydro will not expense but defer.

(If Hydro was a private company owned by another private company, if cost transfers occurred between the subsidiary and its parent, Publius understands that neither revenue nor expense would be recorded until the receipt and expense events were in synch.)

And, none of the respondents backing the development plans have disputed Lane’s assertion that ratepayers are the only party at direct risk, that government hasn’t a dollar invested in Hydro’s capital, and that ratepayers will be called upon to meet whatever net costs the present plans end up generating.

For Publius, it seems clear public responsibilities are not being upheld. Officials and agencies are not fulfilling their obligations  to the public interest.

The importance of Hydro’s plans, with potential major negative implications for domestic ratepayers, require an immediate opening up of the books and plans, the involvement of truly independent and expert parties, the involvement of an all-party committee of the Legislature, and a slow-down of plan expenditures and further commitments until that is done, and done properly.

If things ‘go bad’, a possibility that Lane raised in his very open address, not only will ratepayers be called upon to deal with it, Publius suspects ratepayers will only know of it, and its dimensions, after another election or two.

By then, all those complicit in the current ‘hiding show’ are likely to be long gone from the public scene.

As mentioned before, most Canadian provinces and territories do not even provide compensation to land owners who are directly affected by an endangered species designation.

The Montana-based Property and Environment Research Center (PERC) has presented some incentive-based systems to help preserve endangered species while respecting individual property owners.

“Candidate conservation banking” is an incentive-based system aiming to balance the two.

PERC describes it this way:

“Under this model, private landowners who voluntarily conserve habitat on their property receive “credits” — a unit of trade that places monetary value on conservation measures — that can be sold in the marketplace. The number of credits on a parcel of land is determined via a science-based method to ensure a net conservation benefit for the animal when used as offsets by buyers for future impacts, such as removing ground cover or accidentally crushing a tortoise while installing a solar power plant. In exchange for alleviating potential impacts, buyers would receive regulatory predictability from the U.S. Fish and Wildlife Service if the species becomes officially “threatened” or “endangered.” Indeed, the Fish and Wildlife Service issued a notice of proposed rule-making to support such assurances.”

The Canadian government and the various provinces and territories should emulate this plan. And then, it can be evaluated for its effectiveness.

Publius

approximately $300 million of new annual revenues projected to be generated by an increase in the PST (provincial sales tax) and other fees with the government’s planned ‘additional’ expenditures on provincial infrastructure.

He infers that without the tax and fee increases, and the revenues they are to bring in, infrastructure investments could not be made (i.e. the latter must  follow the former).

Taxpayers are either being purposely misled, or the government is simply relying on the public’s general lack of knowledge of government accounting.

Selinger fails to note that while the new revenue (from the tax and fee increases) will flow into the Province’s summary accounts over the years of receipt far into the future (unless withdrawn in the future, a  highly unlikely event with the present government),  the expenditures on infrastructure are one-time in nature and be recorded in the Province’s summary accounts as an expense only as the ’assets’ are amortized over their service lives.

Apples and oranges, and Selinger  knows it.