Quote:
Originally Posted by bomberjet
I'll take a 16% reduction in my hydro bill. Yes please.
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So you'd out-source thousands of mid and senior-level good paying jobs in Manitoba to some other province (or country) so you could save $16 a month - which would be temporary, because capital costs continue to go up anyway?
The economic multiplier effect on Manitoba's economy is probably much higher for those thousands of MB Hydro jobs located right here in the province compared to the marginal monthly gains (<$50) everybody would get from lower administrative costs if those jobs were slashed.
On net, somehow "outsourcing" Hydro's administrative and maintenance functions to another province or country would likely result in a loss to Manitoba's prosperity.
For those who think the Utility Crown Corp is an inefficient government pig trough that is poorly run, I'd encourage you to look to other regions that tried to or have privatized utilities and see how that's going for them and their rates (i.e. Ontario or Texas). Hint: privatization does not lead to lower utility rates. In fact, it will likely lead to the opposite because in a laissez faire "capitalist" utopia with no corporate regulation or oversight (i.e. the PUB), profit-maximizing corporations have little incentive to keep rates low on a natural monopoly like Hydro electric power.
It's not like privatizing electricity in Manitoba is going to lead to 50 other electric utilities all coming up here and building their own dams and power distribution networks, leading to competition and lower rates. Instead it will be one company who now reports to shareholders that want to maximize this quarter's profits as opposed to the current setup where the utility is overseen by the Provincial Government (i.e. Manitobans) and the PUB.
People who think the privatization of Hydro is a good thing for Manitobans are shortsighted and can't think past the $10 a month they will save on their utility bill for the first year, which will quickly disappear after the spotlight is no longer on the newly minted privatized utility. Let me ask, are Manitoban's cell phone bills lower now compared to before MTS was sold to Bell? Doubtful, Saskatchewan - who still has SaskTell - seems to have more competitive plans due to increased competition there. Would Manitobans be better of MPI was privatized? The
C.D. Howe Institute ranked Manitoba and Saskatchewan as having the best auto insurance plans in Canada. And having a
look at the history of Hydro One's electricity rates in Ontario sure doesn't seem to lend credibility to the idea that utility privatization leads to lower rates on net - if anything, it has introduced uncertainty to users with wild swings in on-peak pricing which may be a good thing to encourage more even distribution of electricity consumption over the day, but likely a net loss to consumers from a billing perspective.
It's hard to argue that the privatization of a utility will lead to a net gain in consumer welfare in Manitoba, even if it marginally or entirely reduces administrative costs. Like we've seen in the past, it would likely lead to a reduction or elimination in head office employment (instead going to Calgary or Toronto), reducing aggregate wages in Winnipeg in exchange for a small decrease in the average consumer's monthly bill. That's not a deal I'd be willing to take, nor would most people who can think past the extra one pizza per month they could purchase with the newly found savings.
/end rant
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