Don't block N.B. Power rate hike, opposition parties tell government

The two opposition parties in the legislature are backing the Higgs government's approach to not intervene to block N.B. Power's proposed rate increases. 

Both the Liberals and the Greens say interfering with how the Energy and Utilities Board rules on the 8.9 per cent increase would only perpetuate a history of politically motivated rate decisions. 

Liberal energy critic Keith Chiasson said in the legislature the utility was "gouging" ratepayers and told reporters the government "has a role to play."

But party leader Susan Holt, speaking to reporters alongside Chiasson, was quick to add there's a downside to political intervention. 

She said the government can't continue to "ruin the utility" by keeping rates artificially low, adding to its debt. 

"Our worry is if they force another two per cent increase to N.B. Power, we're going to continue to destabilize our utility," she said.

"The debt is going to continue to grow. The operations won't be able to transition to the kind of green and renewable energy that New Brunswickers want to see from the utility." 

She said the government must balance that with the fact the 8.9 per cent increase "is too large for many people to handle," and find a way to help.

N.B. Power filed the rate application with the Energy and Utilities Board on Wednesday.

It says it needs the increase to cover soaring fuel costs and other expenses subject to inflation, as well as recent interest rate increases. 

But even the 8.9 per cent increase will only be enough to keep the utility financially afloat next year. It won't chip away at the corporation's accumulated $5 billion debt.

Previous governments have imposed small rate increases on the utility or have even stepped in to stop the EUB from approving rates considered too high.

The Higgs government says it won't do that and prefers to look for other ways to help consumers cope with the higher rates, such as energy efficiency programs to encourage people to consume less electricity.

"We have to find a way that the utility can get on a footing going forward," Premier Blaine Higgs said Thursday. "Let the EUB do the process. That's why we have it." 

Green Leader David Coon also agreed with that approach. 

"We've seen too much of that in the past, and that is the kind of thing that has helped get us to the point where we are now, where N.B. Power is asking for 8.9 per cent."

But he said the province should offer more robust, "properly funded" energy efficiency programs. Higgs hinted on Wednesday a new program is coming. 

Pay increases recommended

In a case of awkward political timing, N.B. Power announced its rate application the same week an independent commission submitted a report recommending pay increases for members of the legislature, cabinet ministers and the premier.

MLA salaries were frozen at $85,000 a year in 2008. 

The commission recommended that the pay be raised to $93,150, the salary that would be in effect if governments had followed the advice of an earlier independent study to tie pay levels to increases in gross domestic product — essentially, economic growth.

Higgs said he hasn't read the new report, but pointed out that no one else has had their salary frozen for 14 years. 

"Should that continue like that? No, I don't think it should continue like that. I think it should be comparable to what everyone else achieves," he said.

The commission is recommending future MLA pay raises be tied to increases for civil servants.

It also suggests the premier's salary be double that of an MLA and that people in other positions, such as cabinet ministers, have their member salaries topped up based on a formula.

The commission itself, made up of retired New Brunswick Court of Appeal justice Margaret Larlee and Moncton lawyer Robert Basque, acknowledged that implementing its recommendations would be controversial.

"The decision will be based on political judgment," wrote Larlee and Basque. "An increase for any reason will be criticized. There is never a good time for one."

The government is not obligated to follow the commission's recommendation.

Holt did not take a clear position on the proposal, calling it "a tough one."

"I want every tool possible to recruit a great team, so I'm conflicted. On the one hand it will help me build a phenomenal team to represent New Brunswickers. On the other hand it's a really terrible thing to try and oversee your own pay increase."

Coon said he was against a pay increase, especially with New Brunswickers facing higher food, gas and housing prices along with a potential power rate increase. 

"The optics would be terrible. We're comfortable in my caucus with the pay we're at right now." 

Coon endorsed recommendations in the report to increase the budget MLAs use to pay constituency staff in their ridings. 

The commission also recommended a study on whether it would be cheaper to buy MLAs electric vehicles rather than paying them for the mileage they put on their personal vehicles when travelling for their jobs.