Former Nalcor board chair takes soft tone on issues of Muskrat disclosures
Ken Marshall says knew of higher capital cost at financial close; lawyer suggests otherwise
A marathon sitting of the Muskrat Falls inquiry Monday again demonstrated how questions about information disclosure by Nalcor — or more specifically, former CEO Ed Martin — to the board of directors and the provincial government dominate much of the recent testimony.
On the witness stand was Ken Marshall, a former member of the Crown corporation's board of directors, who served as chair during a pivotal period between 2014 and 2016.
The schedule had Marshall and another former board chair, Cathy Bennett, testifying back-to-back on Monday. Bennett was also the province's minister of finance from 2015 to 2017.
But instead of whizzing through two witnesses, as was the plan, Marshall's testimony dragged on into the evening, forcing Bennett to wait around for hours until Commissioner Richard LeBlanc finally told her to go home and return early Tuesday morning.
Nalcor jittering over access to information
Inquiry lawyers focused on familiar topics such as Nalcor's fixation about not revealing commercially sensitive information, its apparent jitters over access to information laws, and secret — and alarming — cost estimates produced by the project team that never seemed to go further than Martin.
Ken Marshall went on the defensive over assertions by some senior public servants that Nalcor actively resisted or opposed the work of government's oversight committee.
But unlike other senior bureaucrats and a parade of high-profile politicians, who expressed shock and anger at being denied information by Nalcor, Marsall took a much softer tone.
He said he felt "concern" that some information was not passed onto the board, but offered justification by suggesting new project costs should only be shared when they have been fully scrutinized, "pressed and tested" by Nalcor's executives.
"Personally, I would have liked to have seen it. I prefer to see more information than less. But proper governance would dictate that no, that it was not a fully tested set of assumptions … that no, it wouldn't go to the board at that point in time," he said.
Competing testimonies
Muskrat Falls was sanctioned at a construction cost of $6.2 billion in late 2012, with an 824-megawatt hydroelectric station on the Lower Churchill River as its centrepiece.
By the time the financing, including a $5-billion federal loan guarantee, was finalized a year later, however, the cost had crept up to more than $6.5 billion.
Yet this figure was never disclosed publicly, and various public servants, including the clerk of the executive council at the time, Julia Mullaley, testified they were not informed of the higher amount.
Politicians from that era, including then-finance minister Tom Marshall, have also testified they were unaware of the increase.
Ken Marshall, however, said it was discussed around the boardroom table. There's no written evidence to back up his claim because it was common for such sensitive financial details to be omitted from the minutes of meetings, as Nalcor feared they might be revealed through access to information requests.
That set up this tense exchange between Marshall and inquiry co-counsel Barry Learmonth:
"What I'm suggesting to you, Mr. Marshall, is the board was not informed of the $6.5 (billion) prior to financial close," said Learmonth.
"Yeah well, you can suggest that but I don't agree with it," Marshall replied.
Marshall's testimony was similar to that of Kathy Dunderale, who was premier when financial close occurred. Dunderdale testified in April she "must have known" the capital cost had increased by $300 million, and that she was likely told by Ed Martin.
Information flowed slowly
Andrew Fitzgerald, the lawyer for Mullaley and another senior bureaucrat, Charles Bown, suggested Nalcor was keeping "two sets of books."
"How can government officials be expected to conduct their oversight functions when the very individuals in the upper echelon of Nalcor are not even sharing information with you?" Fitzgerald asked Marshall.
"Difficult," Marshall acknowledged.
When asked by Fitzgerald if the board's oversight of Nalcor was hindered by the slow and selective flow of information, Marshall said, "In hindsight, perhaps."
Ed Martin, meanwhile, will testify in this phase of the inquiry on Wednesday and Thursday.
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