'I'd say that's nonsense': Nalcor board members challenged about their connections to Danny Williams

Three key former members of the Nalcor Energy board of directors acknowledge they have close ties with former Newfoundland and Labrador premier Danny Williams.

But were they appointed to the Crown corporation's board in order to ensure Muskrat Falls was sanctioned without the necessary scrutiny?

"I'd say that's nonsense," former board member Gerry Shortall said Tuesday during a second day of testimony at the public inquiry that is investigating the decision to sanction the project, and the subsequent cost overruns and schedule delays.

High number of vacancies

Shortall, Ken Marshall and Tom Clift were all long-serving members of the Nalcor board, and all three have close personal and business connections to Williams, who served as premier from 2003 until 2010 and remains a hard-charging supporter of the project.

Shortall, Marshall and Clift were part of a panel of four former board members that also included Terry Styles, who testified at the inquiry this week. Styles served a brief stint on the board and was chairman when the Muskrat Falls project was sanctioned in late 2012.

Those connections to Williams, and the persistently high number of vacancies on the Nalcor board during the leadup to project sanctioning, often stirred theories among critics of Muskrat Falls.

And that theory was put to the former Nalcor board members by Geoff Budden, lawyer for the Muskrat Falls Concerned Citizens Coalition, on Tuesday.

Question is insulting

Appointments to the board are at the pleasure of the premier and cabinet, and there were times during the last decade when membership dropped to as low as four for a board that can accommodate up to a dozen people.

So did Williams and others in government desire a small, under-resourced board? One whose ranks were comprised of friends and supporters to ensure Muskrat Falls would get approval, without the broadest of scrutiny?

Ken Marshall said that theory is wrong.

"We worked hard and independently. Disagree," Marshall said.

Styles described the line of questioning as "insulting."

Clift said he routinely pleaded for additional members with big-project expertise, but does not believe board decisions were affected.

"It was challenging, I grant you that. I did not personally feel compromised," Clift said.

Ed Martin an 'excellent' CEO

The composition of the board and the small amount of compensation available for members came up several times during testimony.

It was one of a wide range of topics that weaved from the spectacular blowup of the board and the controversial departure of former Nalcor CEO Ed Martin in April 2016, to whether risk factors were understated in order to make Muskrat Falls more appealing to the public.

We were very upset with the dismissal of Mr. Martin as the CEO. He was, in our opinion, an excellent CEO throughout the period.- Gerry Shortall

"We were very upset with the dismissal of Mr. Martin as the CEO. He was, in our opinion, an excellent CEO throughout the period," Shortall told the inquiry.

All four board members say they were comfortable with their decision to vote in favour of final sanction of the project in December 2012, when construction costs were estimated at $6.2 billion and first power was to flow in mid-2017.

Nearly six years later, construction costs have soared by $4 billion, with all-in costs, including financing, ballooning to nearly $13 billion. And first power is not expected until mid-2019.

The former board members repeated earlier positions that they felt they were provided with the right information, and based on that information, believed Muskrat Falls was the best option.

"We believed firmly at the time that we had all the information, we took the right decision, and it was absolutely in the long-term benefit of Newfoundland and Labrador," Marshall told reporters following completion of his testimony Tuesday afternoon.

'We were well-qualified'

When asked if he still believes Muskrat Falls was the best option, with the benefit of hindsight, Marshall said, "That's a speculative question," but added, "I'm still optimistic it will be in the best interest of the province."

Lawyers for various groups also challenged the experience and qualifications of the board members, but Marshall faced down that criticism afterwards.

"I feel personally we were well qualified. We spent a lot of time on that board and worked a lot of long hours," he said.

Meanwhile, Styles resigned from the board in early 2014, less than two years after his appointment.

"I may have underestimated the level of commitment the position demanded. I felt that it was starting affect to my personal business interests," he explained.

A vicious attack, says Marshall

As for Shortall, Marshall and Clift, they left the board in spectacular fashion in April 2016 during a tumultuous time in the province.

A new Liberal government led by Premier Dwight Ball had taken power at the same time as costs were soaring and public outrage was mounting.

The budget speech by then-finance minister Cathy Bennett — also a former chair of the Nalcor board and outspoken supporter of Muskrat Falls — on April 15, 2016, was highly critical of Nalcor, and "basically cut the legs out from underneath (Martin)," said Marshall.

Within a few days of the budget, Martin was out as CEO, and the entire board had resigned.

"It was rather vicious in its condemnation of the organization and its project," Marshall said of the budget speech.

The board members said they remained supportive of Martin's leadership at the time.

"We wanted to get the project finished," said Marshall. "But it became an untenable situation."

I'm not sure if I'd do it again, but we did it to the best of our abilities.- Tom Clift

Styles, meanwhile, said, "I conducted myself with honesty and integrity" while serving on the board, and Clift added, "I'm not sure if I'd do it again, but we did it to the best of our abilities."

When asked if they felt they were misinformed in the leadup to sanctioning of Muskrat Falls, they replied with a collective "absolutely not."

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