Friday, November 02, 2007

Did McGuinty Cook a Fibratech Corporate Welfare Deal to Win the Seat?

Did Fibratech, an Atikokan fibreboard manufacturer, agree to wait until after the election to announce it was going into receivership? Voters deserve to know. The withholding of this news gave the Liberals the seat by 36 votes.

The first day after the election, Fibratech announced it was going into receivership. It is taking with it over $6.15 million in taxpayer money (maybe $8.15 million) not including some other federal contributions. It doesn't pass a smell test to make the announcement after the local Liberal was reelected. The local Liberal MPP won by a meagre 36 votes over the NDP candidate.

Regional Voting results:
DISTRICT: THUNDER BAY-ATIKOKAN Candidate Party Vote Count Vote Share Elected
Bill Mauro LIB 10913 37.66% X
John Rafferty NDP 10877 37.54%
Rebecca Johnson PC 5914 20.41%
Russ Aegard GRN 1271 4.39%
October 11, 2:25:56 AM EDT 193 of 193 polls reporting
About these figures:
All results are unofficial until final ballot counts are verified by Elections Ontario, which usually takes 2-3 weeks.

Despite a $2 million loan guarantee and a $400,000 grant handed out by Mr. McGuinty on the eve of the election in July, Fibratech is, yet again, going into receivership. As well, it owes Atikokan $1 million in upaid local taxes. In 2005 the federal government also gave it $2.75 million from FedNor and a grant of an undisclosed amount through the Softwood Industry Community Economic Adjustment Initiative (SICEAI). Further, a search of the public accounts of Ontario reveals a loan guarantee of $2,000,000 was already on the books n 2005. It is unclear whether the firm had two loans guaranteed for $2 million each of if there was one which was extended and reannounced.

This sure looks bad. Not only did the corporate welfare not create sustainable jobs but it appears to have been used to help secure a precarious Liberal seat. Corporte welfare defenders deny it is used for vote buying, but examples like this make it hard to swallow.

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