Clark's Ghosts Dog James

As the 2005 provincial election draws closer, the New Democratic Party is trying harder than ever to distance itself from the Glen Clark administration that led the province from 1996 to 2001, arguably one of the most disliked governments in B.C. history.

The party's new leader, Carole James, openly says the Clark government made a variety of mistakes during its time in office. She is trying to enhance the NDP's relationship with the business community. And she is trying to persuade voters across the province that in her version of an NDP government, a gentler, kinder social safety net would be combined with fair, efficient and effective economic policies that would not drive business and industry out of the province.

But every time she tries to make the switch, yet another ghost from the Clark administration pops up to haunt the voters of B.C. One suspects many will decide that a return to an NDP government might be just too scary to contemplate.

The latest ghost comes this week from the B.C. Supreme Court. It's yet another government business decision where political considerations and influence are alleged to have overridden genuine merit. In this case, the decision involved the privatization between 1997and 1999 of B.C. Online (the forerunner of the Liberal administration's equally troubled Internet Portal project).

Sale generated cash for budget

The privatization project was not one that drew the sort of headlines that have been attracted to Premier Gordon Campbell's privatization plans (think Coquihalla Highway or BC Rail). But the history of the project, as outlined by Supreme Court Justice Robert Bauman, shows that it became bogged down in exactly the same sorts of political questions that have dogged Campbell's efforts.

It was April 1997 when the Clark government first announced its plans to turn B.C. Online over to the private sector in a complicated lease arrangement (think B.C. Rail again). Government would retain ownership of the information involved, but a private company would actually run the service, collecting a fee from each transaction to cover costs and provide a profit. In return for this, the successful private contractor would be expected to provide an upfront payment to the government (which, just like the Campbell administration again, was trying to ensure it had enough revenue for a balanced budget).

So far, so good. A total of five private companies put in bids to take over the job. An "evaluation committee" was set up to look at the bids. It was comprised mainly of civil servants from various ministries involved with the internet systems, but was chaired by an outside consultant, one Dan Perrin from Victoria.

Toronto bidder alleges conspiracy

It is, however, the activities of that evaluation committee that are now the subject of the lawsuit. One of the bidders was a company called Infowest Services, headed by Toronto businessman Mohammed al-Zaibak, with a number of well-known B.C. business names on its board of directors.

Infowest scored highly on some of the criteria. It was, for instance, considered the best out of the five in terms of how it would treat the government employees that were running the program at the time. However, it was not allowed to proceed to the final bidding process (now think B.C. Ferries). The evaluation committee said it hadn't made the passing grade of 70 per cent on one of the criteria specified. (Just which one isn't disclosed in the court documents.)

And that is the decision over which Infowest is now crying foul. The company's amended statement of claim in which it explains its case to the court runs to 85 pages and, Justice Bauman says, "alleges a civil conspiracy of Byzantine proportions." It involves, the company alleges, "malfeasance of public office" and "abuse of power." And it names a number of individuals, as well as the government itself. Chief among them are Clark and his former top economic advisor Tom Gunton.

Evaluation process questioned

Infowest says the evaluation was "not fair or equal or conducted in good faith," but instead was subject to "improper influence by undisclosed and extraneous considerations and political pressure."

In fact, Infowest suggests there may have been two separate conspiracies going on. It says some on the evaluation committee were opposed to the whole idea of privatization and wanted the service to remain in a company that was part of, or close to, the public sector. But Infowest argues the even larger conspiracy involved ensuring that the contract went to Macdonald Detwiller.

Justice Bauman makes it very clear he is not yet prepared to believe in Infowest's conspiracy theories. At the end of the day, he says, the conspiracies may be shown to have existed nowhere except in the mind of Infowest and its principals.

But at the same time, he writes: "In short, Infowest was, and is, no gadfly quixotically tilting at bizarre and imagined conspiracies." He notes that the company spent more than $1 million on its work to bid on the B.C. Online contract, something which itself might well be taken to show that it was a serious contender in the process.  The judge has refused to throw out any of the claims on the basis that they are frivolous or vexatious or don't disclose a reasonable basis for a lawsuit.

Trial could conclude during election

And therein lies the problem for the NDP. With Bauman's judgment now in, the whole thing is scheduled for what promises to be a messy three-month trial in B.C. Supreme Court in Vancouver beginning in February 2005. That means it should wrap up just before or during the formal election campaign .

It will be very difficult for James and the NDP to launch loud and passionate attacks on the privatization problems of the Coquihalla, BC Rail and BC Ferries if they play out against a high-profile trial in which an NDP government is accused of behaving equally badly.

Barbara McLintock, a regular contributor to The Tyee, is a freelance writer and consultant based in Victoria and author of Anorexia's Fallen Angel.