Nova Scotians need a power utility that can compete while handling its own internal business, not a charity case.
The latest revelation in the ongoing saga of Nova Scotia Power holding its hand out for more is a reported pension shortfall of $185 million at the end of last year.
Although the utility says it is taking steps to manage pension costs, that has been acknowledged as one of the reasons it is looking for its three per cent rate hike in each of the coming two years.
Reason for the pension shortfall? Declining performance in global investment markets. Whoops, didn’t see that one coming.
Other reasons for a rate hike? Increasing fuel costs. Golly, that wasn’t on the radar either. Yet we note the people running the corporation still make the big bucks.
Stephen McNeil, the province’s opposition leader, has of late been on the rounds making a case for the need to break NSP’s monopoly. With the utility and parent company Emera taking more than $100 million a year in profit out of the province, McNeil contends, let them and their shareholders deal with a pension shortfall.
Hitting up customers again, he said, comes in the face of average Nova Scotians struggling to fund their own retirements.
And again, we run into the issue of pension plans that smile on public employees and favoured corporations such as NSP – the defined benefit model. For the exact reasons of a declining work force, a growing retirement population and unpredictable markets, many private companies are shifting to defined contribution pension plans. Otherwise the plans are unsustainable in the long run.
That does, unfortunately, mean settling for less if a retiree has to start drawing from the fund when markets are down. But what’s the alternative? Oh yes, in the case of government and NSP, they can make a captive public pay for the shortfall.
This has gone on long enough. McNeil is right. NSP has to learn to sink or swim in the real world of competitive business.