Auditor General’s turn to roll out the barrel, Report on Department of Energy’s review systems likely to echo royalty review panel’s stern findings by Graham Thomson, September 29, 2007, The Edmonton Journal
The first shoe dropped last week. The other shoe, we are told, will drop this coming Monday. Together they just might give the boot to the government’s outdated royalty system. The first shoe was the report of the Alberta Royalty Review Panel released 10 days ago that called for a 20-per- cent hike in royalties and pointed out serious problems with how the government monitors the energy industry.
The second shoe is the annual report from Auditor General Fred Dunn. Among other things, Dunn’s report will include a chapter on how the government keeps track of the royalty system. According to a news release, he will be answering the questions: “Are the Department of Energy’s royalty review systems adequate? Do systems exist, are they well-designed, and do they operate as they should?” The answers, according to the royalty review panel’s report, are no, no, no, and no. …
According to senior government sources, Premier Ed Stelmach is looking for cool-headed facts to help him counter the emotional outbursts from energy companies fighting against increased royalties. The sources say Stelmach is sincere in his assertion he will not be intimidated by the energy industry in coming up with a response to the review panel’s recommendations in mid-October. This may just be spin but it’s fascinating spin, nonetheless. According to the sources, Stelmach has known for some time the government needed to significantly increase its energy royalties and improve its system of monitoring the industry. He needed information to prove his point. The royalty review panel did just that.
In this Stelmach-as-Machiavelli scenario the premier realized that by appointing an independent panel of strong thinkers he’d get a report that would help him put some distance between himself and the Klein era, to demonstrate he is his own man, even though he was a member of the Klein cabinet. The only thing that surprised Stelmach, say the sources, was how brutally frank the panel was in its criticism of the current royalty regime. … This scenario only rings true, though, if Stelmach adopts the report’s recommendations. If he crumbles under pressure from energy companies, he will only solidify his reputation as someone who cannot make a tough decision. [Emphasis added]