The preliminary prospectus for the sale, filed with the Ontario Securities Commission late Thursday evening, confirms the government hopes to raise $9 billion from a sale of 60 per cent of the company. The Wynne government has already committed to using $4 billion of that revenue on
new spending.
“This is akin to selling your car to buy concert tickets,” said CTF Ontario Director, Christine Van Geyn. “It’s foolish sell a revenue generating asset and blow it on one-time spending.”
The use of proceeds for new spending is despite provisions in the
Electricity Act which
previously required all proceeds be applied to paying down the debt of the company held by the Ontario Electricity Financial Corporation. This legislation was amended in the
2015 budget in order to make the sale of Hydro One possible.
“Ontario should be getting top dollar for an asset like Hydro One,” continued Van Geyn. “If all proceeds are not being used to pay down hydro debt, they should at least be used to deal with the province’s $8.5 billion deficit. But instead, Kathleen Wynne is spending this money before it’s even in her hands.”
The preliminary prospectus also outlines millions that will be paid in compensation to the current executive of Hydro One. Mayo Schmidt, who only just took over as President and CEO of Hydro One on September 3rd, could receive up to $4 million in target total direct compensation for 2016. Mr. Schmidt is also entitled to $3.23 million in severance if he is terminated. The previous CEO of Hydro One, Carmine Marcello, had a total compensation package of
$1.26 million.
“The province intends to retain 40 per cent ownership of this company, which means taxpayers are on the hook for the sky-high compensation packages for the new Hydro One executive,” concluded Van Geyn.
Christine Van Geyn, CTF Ontario Director
