Minister suggests Manitoba Hydro 'bankrupt'

It may be saddled with debt, but Crown Services Minister Ron Schuler went one further in the Legislature today and said the utility had been bankrupted by the NDP.

Crown Services Minister says Manitoba Hydro bankrupt because of previous government

Crown Services Minister Ron Schuler says Manitoba Hydro had been bankrupted by the NDP. (Darren Bernhardt/CBC)

It may be saddled with debt, but Crown Services Minister Ron Schuler went further than that in the Legislature on Monday saying Manitoba Hydro had been bankrupted by the NDP.

Schuler was responding to questions from the opposition during the afternoon session and referring to a report done on Manitoba Hydro by Boston Consulting Group.

"I think the question is, Madame Speaker, basically why did the NDP, during their watch, bankrupt Manitoba Hydro?"

The comments drew the ire of the opposition for being "irresponsible." 

NDP finance critic James Allum said Schuler isn't doing anything positive for the reputation of the crown corporation.

"I think it's utterly irresponsible for the Crown Services Minister to make that kind of comment about Manitoba Hydro. He's hurting the reputation of the company when he does that, which is only going to hurt our export markets, which is ultimately going to mean rates are going higher for Manitobans," Allum said.

Schuler wasn't available following question period. Premier Brian Pallister acknowledged the Crown Services Minister did use the word bankrupt when referring to Hydro. 

"We know that there is a debt that significant and has grown enormously under the previous administration. We know that money lenders are concerned about that debt. We know that they are concerned about the combined debt of [Manitoba] Hydro and the province," Pallister said.

Premier Brian Pallister says he acknowledges debt level at Manitoba Hydro are a concern. (CBC)
When asked if the word "bankrupt" was inappropriate when discussing the fate of the utility and the possibility of paying higher interest rates for the debt, Pallister said it wasn't.

"I don't know if I agree. I think we have to confront the reality of the situation," he said.

"The reality is we have a massive debt problem in the province and with Hydro, made worse by the over-build by the previous government when they were Americanising Manitoba Hydro."

Allum responded that Manitoba Hydro was simply not bankrupt and the government was trying to scare Manitobans.

"We would expect quite the opposite from the minister. He should be out promoting Manitoba Hydro as a clean, green, reliable source of energy that's good for Manitoba and is good for exports," Allum said.

A spokesperson for Manitoba Hydro told CBC News it would be inappropriate for the utility to comment on statements made by the minister.

The crown corporation has a relatively new board appointed by the PC government and has signaled economic challenges due to high debt levels.

Board chair Sanford Riley has identified the debt as a "huge concern." Currently the utility has a debt of approximately $13 billion. That's expected to climb to $25 billion over the next three or four years.

At a public consultation meeting, Riley also said the utility was considering asking for an equity investment from the province.