It’s been rather quiet on the Coons/Falcon front of late, the opposition member and the Transportation Minister taking a brief sabbatical from the slings and arrows of the ferry file.
But that came to an end on Tuesday as the North Coast MLA returned to the ring with a critique of the Ministers handling of the Sonia purchase and the increased purchase price due to an Industry Canada provision to tax foreign built vessels.
Coons took the provincial government to task over the privatization of the ferry corporation, which now has them on the hook for Federal duties and the GST on the Sonia upon her arrival at a Canadian dock.
With quiet time apparently done now, we anticipate many more salvos in the point/counter point nature of the Ferry Corporation and the many issues and challenges that face Ferry transportation along the BC coast.
His take on the issue was presented on the front page of Tuesday’s Daily News.
MINISTER TO BLAME FOR SONIA COSTS SAYS COONS
By Leanne Ritchie
The Daily News
Tuesday, December 12, 2006
Pages one and two
Gary Coons says Transportation Minister Kevin Falcon should look in the mirror if he’s looking for someone to blame for the increased cost of purchasing the ferry MV Sonia.
The North Coast MLA said having to pay the GST is simply another downside to the Liberal’s decision to privatize B. C. Ferries.
“This so-called private corporation is owned by the people of British Columbia, and the province puts more than $100 million into B. C. Ferries annually,” Coons said. “But because B. C. Ferries doesn’t have Crown status, it isn’t exempt from the GST. So tax dollars from British Columbia are essentially going to pay federal taxes.”
Falcon criticized the federal government last Thursday for additional fees that could add 25 per cent to the purchase price of the Sonia, especially given the tragic circumstances that prompted the replacement.
B. C. Ferries has applied to the federal government for a duty remission and they haven’t been officially declined, however, a B. C. Ferries spokesperson said the company is getting indications the application will be rejected.
The Queen of the North’s replacement vessel will be slapped with $17.7 million in federal duties and tax when she sails into Victoria in mid-December/ this includes $2.7 million in GST.
The $51 million MV Sonia, traveling from Greece, is expected to arrive in Victoria about Dec. 18. It will replace the Queen of the North, which sank in March, killing two passengers.
“Because B. C. Ferries is no longer a Crown corporation, the purchase of the Sonia is subject to GST,” said Coons, the New Democrat Critic for Ferries and Ports. “That’s more than $3 million, and that doesn’t take into account the cost of parts and materials needed for the refit.”
Coons, MLA for North Coast, said it’s not a secret that Crown corporations are exempt from federal taxes. Yet the B. C. Liberal government went ahead with their quasi-privatization anyway.
“Minister Falcon needs to take responsibility for the decisions of his government,” Coons said.
“They decided to remove this public asset from Crown corporation status. He can’t reasonably blame that on the federal government or anyone else.”
Coons said this problem will be exacerbated when the new C-Class ferries are finally purchased.
“These are increased costs which will hit ferry-dependent communities hard,” Coons said.
And let’s be clear that’s a direct result of the actions of the B. C. Liberal government.”
Over the next five years, B. C. Ferries plans to add seven new ships at a cost of about $900 million.
Of those, three new Super-C class vessels are being built at a cost of close to $600 million by Flensburger Schiffbau- Gesellschaft (FSG) in northern Germany, to be in service early in 2008. The same German shipyard will build the $133 million replacement for the Queen of Prince Rupert.
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