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June 12th, 2002, 04:40 PM
Ontario to retain control of Hydro One
By RICHARD MACKIE
Globe and Mail Update
Toronto — The Ontario government will retain control of Hydro One, Premier Ernie Eves announced Wednesday in reversing one of the major policies of former premier Mike Harris.
Mr. Eves told reporters at Queen's Park after a Wednesday cabinet meeting that the government will hold on to at least 51 per cent of the $5-billion electricity-transmission utility.
From this week's Globe and Mail:
Axe to slice Hydro One executives' salaries
Eves is busy altering his image to little notice
Ingram: The best of both worlds — or the worst?
Please see ROBtv coverage of Hydro One
Duration: 6.24
"Having met with caucus yesterday and having met with cabinet this morning at some length, and having listened to the people of the province of Ontario, the government has decided that it is not going to part with control of Hydro One," he said.
The government will look at different forms of bringing in private-sector investment and participation in the management of the controversial utility.
The options include a strategic sale of shares to one or more partners, the establishment of an income trust or a general sale of up to 49 per cent of the shares to private investors, Mr. Eves said.
Other options
"We still believe that there are ways to bring private-sector discipline to the corporation without parting with more than 50 per cent of the entity," he said.
In the legislature, Liberal Leader Dalton McGuinty accused Mr. Eves of "dithering and fiddling" in his handling of Hydro One, saying he had "introduced uncertainty into the Ontario economy like never before.
"You have somehow managed to alienate both Bay Street and Main Street when it comes to your handling of the hydro file. The responsible thing to do is take your hydro bill off the table," Mr. McGuinty said about the government's legislation that would give it the power to sell Hydro One.
New Democrat Leader Howard Hampton said Mr. Eves was pulling "another 407" by selling off another valuable public asset, refering to sale of Toronto-area Highway 407.
On Dec. 12, Mr. Harris had announced that the government would sell shares in Hydro One to private investors in what would have been the largest initial public offering in Canadian history.
The government, working with a syndicate of major invstment houses on Bay Street, on March 28 produced a prospectus for the sale and shares were expected to hit the market early this month.
But on April 19, Mr. Justice Arthur Gans ruled that the government did not have the power to sell the shares in Hydro One. Mr. Eves responded that the government would pursue the planned sale by giving itself the power to dispose of the shares and by appealing the court ruling.
Sources close to the Premier said that the delay gave him time to reconsider the sale, which he had considered inadvisable when it was announced. Mr. Eves was also hit by the strong public opposition to the sale of one of the province's major assets.
'Confusion' among public
"There is a lot of confusion, I believe, among the public about the two issues of opening up of the [electricity] market to compensation [on May 1] and parting with the ownership of an asset that the public regards as being very important."
Early in May he announced that the initial public offering had been shelved while the government looked at other options for restructuring Hydro One.
His announcement that the government will retain control of the utility is his attempt to show that his government has taken command of the issue.
The decision on the future structure of Hydro One will be made after several months of public and private consultations and will be revealed before the next election, expected next spring.
With a report from Roma Luciw
Ontario to retain control of Hydro One
By RICHARD MACKIE
Globe and Mail Update
Toronto — The Ontario government will retain control of Hydro One, Premier Ernie Eves announced Wednesday in reversing one of the major policies of former premier Mike Harris.
Mr. Eves told reporters at Queen's Park after a Wednesday cabinet meeting that the government will hold on to at least 51 per cent of the $5-billion electricity-transmission utility.
From this week's Globe and Mail:
Axe to slice Hydro One executives' salaries
Eves is busy altering his image to little notice
Ingram: The best of both worlds — or the worst?
Please see ROBtv coverage of Hydro One
Duration: 6.24
"Having met with caucus yesterday and having met with cabinet this morning at some length, and having listened to the people of the province of Ontario, the government has decided that it is not going to part with control of Hydro One," he said.
The government will look at different forms of bringing in private-sector investment and participation in the management of the controversial utility.
The options include a strategic sale of shares to one or more partners, the establishment of an income trust or a general sale of up to 49 per cent of the shares to private investors, Mr. Eves said.
Other options
"We still believe that there are ways to bring private-sector discipline to the corporation without parting with more than 50 per cent of the entity," he said.
In the legislature, Liberal Leader Dalton McGuinty accused Mr. Eves of "dithering and fiddling" in his handling of Hydro One, saying he had "introduced uncertainty into the Ontario economy like never before.
"You have somehow managed to alienate both Bay Street and Main Street when it comes to your handling of the hydro file. The responsible thing to do is take your hydro bill off the table," Mr. McGuinty said about the government's legislation that would give it the power to sell Hydro One.
New Democrat Leader Howard Hampton said Mr. Eves was pulling "another 407" by selling off another valuable public asset, refering to sale of Toronto-area Highway 407.
On Dec. 12, Mr. Harris had announced that the government would sell shares in Hydro One to private investors in what would have been the largest initial public offering in Canadian history.
The government, working with a syndicate of major invstment houses on Bay Street, on March 28 produced a prospectus for the sale and shares were expected to hit the market early this month.
But on April 19, Mr. Justice Arthur Gans ruled that the government did not have the power to sell the shares in Hydro One. Mr. Eves responded that the government would pursue the planned sale by giving itself the power to dispose of the shares and by appealing the court ruling.
Sources close to the Premier said that the delay gave him time to reconsider the sale, which he had considered inadvisable when it was announced. Mr. Eves was also hit by the strong public opposition to the sale of one of the province's major assets.
'Confusion' among public
"There is a lot of confusion, I believe, among the public about the two issues of opening up of the [electricity] market to compensation [on May 1] and parting with the ownership of an asset that the public regards as being very important."
Early in May he announced that the initial public offering had been shelved while the government looked at other options for restructuring Hydro One.
His announcement that the government will retain control of the utility is his attempt to show that his government has taken command of the issue.
The decision on the future structure of Hydro One will be made after several months of public and private consultations and will be revealed before the next election, expected next spring.
With a report from Roma Luciw
