Crown Corp Fronted Energy Minister's Hotel Tab

BC Hydro billed ministry for Lekstrom's Olympic room after Tyee inquiry.

By Andrew MacLeod 19 Apr 2010 |

Andrew MacLeod is The Tyee's Legislative Bureau Chief in Victoria. Reach him here.

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Energy, Mines and Petroleum Resources Minister Blair Lekstrom

The Energy, Mines and Petroleum Resources ministry received a bill from B.C. Hydro for five nights Minister Blair Lekstrom spent in a Vancouver hotel during the 2010 Winter Olympics, but not until nine days after The Tyee asked why the Crown corporation was paying for the minister's stay.

Crown corporations normally have an arm's-length relationship with the government, and Lekstrom is the cabinet minister responsible for setting out the expectations for B.C. Hydro and holding the publicly owned company accountable.

On February 23, The Tyee asked both the ministry and B.C. Hydro why the minister was staying in a room at the Fairmont Waterfront being paid for by the Crown corporation.

A spokesperson for the ministry, Jake Jacobs, said for security reasons he couldn't confirm where Lekstrom was staying but that wherever it was, "Certainly Hydro isn't paying for it."

And B.C. Hydro's spokesperson Susan Danard said the ministry would be paying. "It's not a Hydro-funded thing," she said.

Didn't attend Hydro events

But an invoice now shows B.C. Hydro billed the ministry $1,703.60 on March 4 for "Accommodations provided to Hon. Blair Lekstrom at The Fairmont Waterfront Hotel in Vancouver between Feb 14-17 and Feb 24-26."

The Tyee obtained copies of the invoice through freedom of information requests to both B.C. Hydro and the ministry. A cover letter included with the records from B.C. Hydro said, "B.C. Hydro did not bear the cost of the Minister's stay; that cost was billed to and paid by the Minister."

The letter also suggested Hydro would have no reason to pay for Lekstrom's stay during the Olympics. "The Minister did not attend any B.C. Hydro sponsored events in association with these accommodations, and he did not attend any events using tickets provided by B.C. Hydro," it said.

Lekstrom's ministry declined an interview request Friday. "There is no story here," a spokesperson wrote in an email. "He paid all his own bills."

The spokesperson didn't respond to a further email requesting an explanation for why B.C. Hydro had to be paid back and for any evidence that the arrangement had been worked out ahead of Lekstrom's stay and The Tyee's February inquiry.

The Tyee's FOI requests to EMPR and B.C. Hydro asked for all records related to Lekstrom's accommodation in Vancouver during February, but neither response included any records explaining how or why the arrangement was made.

Why was he even there?

"The general rule would be that if the minister was performing business on behalf of the Crown corporation, then it would be legitimate for the Crown corporation to pay for the expenses," said Doug McArthur, a professor of public policy at Simon Fraser University.

Given that Hydro invoiced the ministry, "It's pretty obviously a case where they've decided he was not performing legitimate business for the Crown corporation," said McArthur. "Otherwise they would have left it as it was."

The matter raises questions about why Lekstrom was in Vancouver during the Olympics in the first place, he said, noting Hydro's invoice was made to the ministry. "That's not paying for it himself either," he said. "That begs further questions whether he paid for it himself at all."

"If this is the minister not on official business using a Crown corporation to cover his bills, this is clearly a problem," said Mark Wexler, a professor of business ethics at SFU.

Hydro may have planned poorly and booked too many rooms during the Olympics, he said, adding there may be an explanation forthcoming that they were looking for people to fill the rooms and the intention was always that Lekstrom would reimburse the Crown corporation. It's plausible, he said, but added, "I think there's been an ethical lapse."

"Had you not made the phone call, Hydro probably would have absorbed the cost," said John Horgan, the New Democratic Party's energy, mines and petroleum resources critic.

'An absence of transparency'

Even if Hydro booked the room, Lekstrom could have paid the bill using a government credit card if he was on government business and a personal one if he was there for his own entertainment. "He should have paid for it on the spot," Horgan said. "Why in the world would they have paid for the minister to start with?"

Transferring the cost to Hydro would have made Lekstrom's expenses appear smaller at the end of the year, Horgan said. "It certainly speaks to an absence of transparency."

And he questioned the fairness of having Hydro pick up unnecessary costs when customers are already facing a nine per cent rate hike. "If Hydro's paying for the minister's room, that means ratepayers are paying for the ministers room."

The government's manual for dealing with Crown corporations, updated in February, describes the relationship: "Cabinet appoints a minister to be responsible for each Crown agency. Under this framework, the Crown agency board of directors is accountable to Cabinet through a designated Minister Responsible, and each Minister Responsible is accountable to the Legislative Assembly and the public for the performance of his or her portfolio of Crown agencies."

The ministry's response to The Tyee's FOI also included bills for three nights at the Fairmont Waterfront earlier in February addressed to the government of B.C. and Lekstrom.  [Tyee]

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