Quite often, reporting on government becomes an exercise in informing the public of what’s gone wrong.
Today, however, it’s pleasing to talk about what’s gone right.
The subject matter may surprise you a bit, Saskatchewan’s Crown corporations that have often been the focus of bad news like rate hikes, bad investments that have lost taxpayers money, failure to provide needed services and, of course, a large and growing provincial debt.
And in the last quarter of a century or so, the Crowns have also been the centre of political controversy over whether or not they should exist at all. This debate over privatization has been the subject of virtually every provincial election since 1991.
That we are talking today about nothing but good news in our Crown sector front is almost newsworthy in itself.
Of course, I say “almost” nothing but good news. The Crown sector isn’t quite perfect yet. There is still the Saskatchewan Transportation Company, whose $11.4-million operating loss in 2011 represents a steady rise from the $10.9-million loss in 2010, the $10.6-million loss in 2009, the $8.5-million loss in 2008 and the $6.7-million loss in 2007.
Those of us that inhabit the cities in particular often sit back and wonder about why the government is the retail liquor selling business at all, as opposed to restricting its involvement to the wholesale distribution business like most every other government in the free world. After all, this concept of private liquor purchasing isn’t exactly foreign to much of rural Saskatchewan that has private liquor vendors and hasn’t seen the end of world yet.
There are still legitimate questions about SaskPower rates and SaskTel cell coverage. And there remains nagging questions about Crown debt that continues to pile about as the Crowns spend a billion dollars a year on infrastructure including a predicted $1.7 billion in 2012.
But while you may have heard a little grumbling about all or some of the above, the Crown sector has actually quietly been out of sight and out mind for most of Saskatchewan in the last couple of years.
That’s because it has quietly gone about its business in recent times of providing services for Saskatchewan taxpayers and, yes, providing health profits.
In fact, according to the Crown Investments Corp. (CIC) 2011 annual report released last week, our provincial Crowns posted profits of $450.9 million last year on $4.6 billion in revenues, a healthy return on investment in the range of 10 per cent. This comes on the heels of a tidy $436.3-million profit in 2010, so it appears that another solid year in the Crown sector is becoming less of a rarity and more of a trend.
Remember, we may be talking about monopoly utilities in some cases, but our Crown corporations aren’t exactly private companies mandated to achieve as large a return for their shareholders as possible. Instead, they are mandated to provide services to customers that they might not otherwise get service (again, things like STC bus routes or SaskTel cell phone services in remote and rural areas) at the lowest rates possible.
Add to this the fact that the Crown corporations are also expected to provide healthy dividends so that the government can balance its own books. In 2011, that dividend to the general revenue fund was $128.5 million _ less than the $471-million dividend in 2010 or the $755-million dividend in 2009, but a healthy dividend nonetheless. (Also, the Crowns are expected to provide a $273-million in 2012 and dividends of around $150 million a year for the next five years or so, according to CIC officials.)
Setting aside whether or not governments should be so reliant on the Crown corporation dividends, they clearly are. So it’s good to report that we now seem to have a healthy Crown sector that is generally fulfilling its mandate.