“Regardless of how people feel about the decision of the AHS board, I don’t think anybody would want me or a colleague to interfere with the terms of their employment they’ve agreed to. It’s a decision for the AHS board.” – Health Minister Fred Horne on Alberta Health Services performance pay (Edmonton Journal, March 28, 2013)
Health Minister Fred Horne did exactly the opposite yesterday when he issued a statement calling on the Alberta Health Services Board to withhold performance pay for its executives. In response, AHS board chairman and trucking magnate Stephen Lockwood rebuked the minister’s statement and the appointed board voted to move forward with the performance payments at a meeting in Calgary.
Fred Horne
This issue has become a political problem for Premier Alison Redford‘s government. Unlike the government’s relationship with school boards, Albertans do not seem to perceive a difference between AHS and the Government. This has left many Albertans confused as to why the health authority is eliminatingfrontlinestaff while senior executives collect bonuses.
When it comes to picking his battles, I am not sure that Mr. Lockwood could have picked a issue where he was more off-side with public opinion.
But will this burst of independence last? The political showdown could come to an abrupt end this morning, when the government is expected to hold a press conference in response to AHS’s decision to approve the payments. The Calgary Herald’s Don Braid writes that Mr. Lockwood’s time as board chair could end today.
Of course, this is not the first time the government has demonstrated its influence over the supposedly arms-length agency.
Stephen Lockwood
In 2010, then-Health Minister Gene Zwozdesky pressed the AHS board to fire CEO and President Stephen Duckett after his infamous “I’m eating a cookie” incident. Dr. Duckett’s departure helped deflect other criticisms the government was facing at the time over Emergency Room wait-times and the suspension of its former legislative assistant for health, Raj Sherman.
The chairman of the AHS board at the time of Dr. Duckett’s firing was Ken Hughes, who is now a Tory MLA and Minister of Energy.
Remind me again why some people perceive the government and AHS as being the same thing?
UPDATE: I guess we now know who the boss is. Minister Horne has fired the entire AHS board over the bonuses issue.
Rumours swirled through the halls of the Legislative for weeks. Whispers and warnings of cuts and rollbacks not seen since Ralph Klein and Jim Dinning unleashed a scorched earth policy on the provincial budget in the mid-1990s. Back in debt. Broken promises. Bankrupt budgets.
The end was nigh.
And today, the budget was tabled and the massive cutbacks did not emerge.
The end is not nigh, but remains difficult to figure out what long-term goals Finance Minister Doug Horner and Premier Alison Redford plan to accomplish with Alberta’s 2013 provincial budget. The devil is in the details and the posturing for the next provincial election, expected in 2016, has already begun.
Doug Horner
The Sustainability Fund that has saved our provincial government from going back into debt for five years is gone and in its place, the government is introducing the Fiscal Management Act, which Minister Horner says will mandate annual savings. In hindsight, and the world of smart fiscal management, this is probably something that the Tories should have started doing when they first formed government more than forty years ago.
Different than most years, this year’s budget is separated into three categories – operating, capital, and savings. This helps the government deflect criticism that it has returned to capital financing in order to build much needed public infrastructure and poses roadblocks to opposition groups hoping to make straight comparisons to previous budgets. The split also allows government ministers to argue with the deficit-hawks in the Wildrose official opposition that the “real” deficit, in the operating budget, is only projected to be $2 billion.
Overall, the budget for 2013-2014 is projected to stay the same as last year’s provincial budget, though the funding within the $36 billion has shifted. Cuts have been made.
Premier Alison Redford
The largest slice of the budget, going Alberta Health Services budget was increased by 3%, rather than the promised 4.5%. AHS Chairman Stephen Lockwood, the trucking magnate from Okotoks, weeks ago publicly declared that he would not fight for the full promised increase.
The Municipal Sustainability Initiative grants awarded to cities, towns, and counties have been frozen at $846 million, the rate in last year’s budget. This may feel problematic for some municipalities, who have already borrowed funds based on expected MSI funding in order to finance critical infrastructure projects. Alberta’s municipalities are responsible for so much of the critical infrastructure and services Albertans interact with daily.
The Alberta Association of Municipal Districts and Counties, known to political insiders as the “Tory farm team” because past rural Tory MLAs who have emerged from its ranks, expressed its disappointment in the cuts to municipal funding programs.
“Rural municipalities are responsible for the roads that keep our economy moving and the government’s lack of support for this critical responsibility will have a huge impact on our members’ budgets,” said AAMDC President Bob Barss.
The Advanced Education budget was cut by 6.8%, creating a likely situation that will see Universities and colleges turn to raising tuition and non-instructional fees levied on students to fill their financial gaps. University of Alberta President Indira Samarasekera sent a mass-email to staff and students earlier this week warning them that changes are on their way.
Calling the post-secondary cuts the largest in two decades, Council of Alberta University Students chair Raphael Jacob said “these cuts are going to have an immediate impact on the quality of our post-secondary education, and potentially longer impacts on the affordability and accessibility of degrees in Alberta.”
The budget also leaves unresolved a number of outstanding political issues facing Premier Redford’s government, such as the two ongoing labour disputes with Alberta teachers and doctors. These fights remain unresolved as the budget included a one year wage freeze for all public employees, including remuneration for doctors. The wage freeze should not be an issue for the teachers, who proposed a deal for two years without wage increases, but the doctors may move to escalate their dispute.
There will be no shortage of commentary on the political implications of this year’s provincial budget, but it is the long-game that matters. This budget is the first of a potential four before the Tories are expected call the next election in 2016. Whether they hope the Fiscal Management Act will earn them dividends from voters or that revenue from an increased price of oil will once again overflow government coffers, we are just in the first year of a four-year long political game.
The previous board chair, Ken Hughes is now Energy Minister and the Progressive Conservative MLA for Calgary-West, so one would easily suspect that Stephen Lockwood‘s connections to the Tory Party are at the root of his appointment as AHS chairperson.
In 2007, Mullen Group founder Roland Mullen and his son, Murray Mullen, were two of the loudest opponents of Premier Ed Stelmach‘s decision to revisit Alberta’s natural resource royalty regime. Their opposition to the royalty review extended so far that the billion dollar company laid off 100 staff during the heat of the debate. Perhaps not surprisingly, in 2008, the father and son donated a combined $25,000 to the Wildrose Party. In 2009, they donated $5000 each to Ms. Smith’s leadership campaign and continued to donate to the Wildrose Party over the next few years.
AHS has been a lightning rod for criticism by opposition parties since it was created by the PCs following the 2008 election. Recent criticism over the decision to close the Little Bow Continuing Care Centrein the southern Alberta village of Carmangay has raised questions about the Tory government cutting funding for facilities and programs in rural constituencies that elected Wildrose MLA’s in the April 2012 election. As if the firing of former President and CEO Stephen Duckett in 2010 was not enough of a public embarrassment, the firing of AHS Chief Financial Officer Allaudin Merali and resignation of board member Sheila Weatherill earlier this summer has done nothing to help the already damaged public image of the province-wide health authority.
Mr. Lockwood’s stated goal in yesterday’s Government of Alberta media release was to achieve something called “Total Albertan Satisfaction“, but in reality his goal will be to provide stability and improve public perception of AHS in the eyes of Albertans.
But perhaps most interestingly, by appointing a chairperson from Calgary who runs one of the largest employers in the town of Okotoks and whose founders are financial supporters of the Wildrose Party, the Tories may have put Ms. Smith and her party in a precarious situation of having to temper their non-stop attacks against the AHS superboard. Or maybe not.
