Premier and former Hydro chair continue battle over board resignation

Premier Brian Pallister traded shots with former chair Sandy Riley over how and why nine members of the board of Manitoba Hydro quit last week.

Riley says Pallister putting out 'inaccurate information' about previous board

Former Hydro chair Sandy Riley says he has to 'set the record straight' about comments made by Premier Brian Pallister. (CBC)

Former Manitoba Hydro board chair Sandy Riley and Premier Brain Pallister continue to exchange words over how and why nine members of the utility's board resigned last week.

CBC News has obtained copies of letters from Pallister and Riley responding to recent events. Versions of these letters were published in the Winnipeg Free Press over the weekend

Pallister's version of the board's resignation centres on his contention there was a dispute over a decision to enter into a nearly $70-million agreement with the Manitoba Métis Federation (MMF) on land and rights claims.

This was because of our inability to communicate with the premier on the serious policy issues facing the corporation.- Sanford Riley, former Manitoba Hydro Board Chair

"The Hydro board resigned once our government's directive became clear. They cited a lack of access to myself and our government, but this situation did not arise because of a lack of communication between the Hydro board and the government," Pallister wrote.

A cabinet directive was sent to Hydro on Wednesday killing the agreement with the MMF.

Pallister reiterated in his letter that the agreement was the catalyst for the board's exodus, saying "it was caused by our government's refusal to agree to a deal that would have been bad for Manitoba."

Pallister's statements 'inaccurate'

But Riley shot back with his own letter disagreeing with Pallister and questioning his facts. 

"Unfortunately, the premier continues to make inaccurate statements about the circumstances leading to our resignation, including misstatements in his column of Saturday March 24," Riley wrote.

The business leader and long-time Progressive Conservative party supporter openly challenged Pallister's version of events.

"The truth is, the board was having serious discussions about resigning long before the MMF directive. This was because of our inability to communicate with the premier on the serious policy issues facing the corporation."  

When we engaged at the ministerial and adviser levels, we were told we needed to talk to the premier. When we tried to talk to the premier, he was unresponsive," Riley wrote.
Premier Brian Pallister answers questions about the resignation of Manitoba Hydro's board Wednesday at the Manitoba Legislative building. (CBC)

Pallister has maintained he could not meet with Riley or the board until after the Public Utilities Board (PUB) has decided on a rate increase for the coming year. A financial crisis at Hydro prompted the company to ask for a rate increase of 7.9 per cent a year for several years.

Pallister has said several times the board's request for meetings could be construed as lobbying before the PUB decision. 

In his letter, Pallister said he "committed to meeting with the board immediately following the Public Utilities Board's decision on Hydro's rate application."

It would be inappropriate for me to meet with the board before that, as it would open both sides to accusations of attempting to influence a quasi-judicial process."

Again, Riley challenged Pallister's version of the truth.

"This is just wrong. We did not, and would never, attempt to communicate with the arm's-length PUB outside of the normal regulatory process. The truth is, we were asking to meet with the government's senior decision-maker to get feedback, and hopefully alignment, on the serious issues before the board," Riley wrote.

A letter by Barbara Biggar — an adviser in the Filmon PC government and paid consultant to the current government on their "Look North" economic strategy — also published by the Free Press, was similar to the premier's piece. 

It was critical of the Hydro board's actions under Riley, saying the premier felt "blindsided" by some of their public comments.

Riley disputes these claims, maintaining the board spoke with officials close to the premier before taking action, and said "if the premier really was blindsided, he needs to ask his advisers and former minister why and how this breakdown occurred within his government." 

Biggar told CBC News she did not want to comment on Riley's letter until she had a chance to read it.  

Riley's letter also indicated he will continue to defend the Hydro board's actions under his tenure. 

"As long as [Pallister] continues to put out inaccurate information which misrepresents the actions and motivations of my fellow board members, I will continue to set the record straight."