Management of Wealth of Non-Renewable Resources
Norway compared to Saskatchewan & Alberta
The Numbers
Norway Resource Fund for Future
Generations
$480 billion.
Fund balance end of 2009 after 13
years of investment.
• Largest equity holder in Europe.
• Second largest sovereign wealth
fund in the world.
4% limit of annual withdrawals for
state expenditures (usually less than
earnings).
•
SK. Growth and Financial
Security Fund (Rainy Day Fund)
$705 million
•
$340 million - Fund forecast
end of fiscal year 2011/2012.
$14 billion - Alberta’s Heritage Fund
after 30 years of investment.
41% - SK withdrawal in 2009/2010.
Value of Crown Potash Corporation
of Saskatchewan Assets given away
to Potashcorp
$30 billion is market value of BHP offer
for Potashcorp potash assets including
New Brunswick mine.
Devine government sold off Crown
Potash Corporation of Saskatchewan
starting in 1989 for zero net gain when
debt transfer to government
is included.
A publication of National Farmers Union, 2717 Wentz Avenue, Saskatoon, SK S7K 4B6 Phone: 306-652-9465
Page 1 of 1
Norway
Oil and Natural Gas
Resource Wealth Extracted 2009
Saskatchewan and Alberta
Oil and Natural Gas
Resource Wealth Extracted 2009
$104 Billion
$10 Billion – Sask.
Saskatchewan Potash Wealth
Extracted 2009
$3 billion – Sk. Potash
industry
$48 Billion – Alberta
$1.2 billion - Potashcorp
Norway and Alberta, oil and natural gas
A publication of National Farmers Union, 2717 Wentz Avenue, Saskatoon, SK S7K 4B6 Phone: 306-652-9465
Page 2 of 2
Norway
Oil and Natural Gas
Citizens Capture of Wealth Extracted
2009
Norway $51 Billion (49%)
Provincial
Oil and Natural Gas
Capture of Wealth Extracted 2009
$1 Billion (12%) – Sask.
Saskatchewan
Potash Industry Mining Taxes 2009
-$184 million (-6%)
$7 billion (15%) – Alberta
•
5 year average is 8%.
•
Potashcorp paid $29 million1 (2%)
in mining taxes on $1.2 billion SK
potash sales.
Potashcorp average price was $440
per KCL tonne, only $35 lower than
2008.
•
Norway and Alberta, oil and gas
1
Potashcorp numbers are in U.S. dollars.
A publication of National Farmers Union, 2717 Wentz Avenue, Saskatoon, SK S7K 4B6 Phone: 306-652-9465
Page 3 of 3
Values and Policy
Norway Government
Vision
Resource wealth is Sacred Trust.
“All petroleum resources shall
benefit the society [present and
future] as a whole.”
Wealth
Capture
Policy
•
Second highest per capita
income in the world.
•
Entrepreneurial and innovative
economy.
State capture 78 % of resource
profit “Due to extraordinary
profitability associated with
production of petroleum
resources.”
Significant revenues for society
(present and future).
•
State Oil and Gas company
captures 100% of the wealth
it extracts.
•
One third of Statoil shares are
available for citizen direct
investment.
•
State invests capital directly in
Saskatchewan Government
Potash Industry/Potashcorp
Give away the resource wealth for
the benefit of foreign global
corporations who pay little tax.
Citizens get the work, corporate
charity, and pay most of the taxes.
Extract the maximum wealth for
the benefit of the executives, and
foreign capital, and pay least
possible in Saskatchewan
royalties and taxes.
•
Widespread disparity in
incomes, infrastructure, and
health outcomes of various
communities within cities and
the province.
Corporations donate
approximately 1% of their
profits to non-profit
organizations.
Industry has to be enticed/begged
to extract scarce valuable
resources.
Industry profit tax credit of
120% for capital expansions
above 2002 levels.
Set the royalty rates lower or
equal to Alberta which has one of
the lowest wealth capture rates for
its citizens in the world.
Zero profit tax royalty on sales
above 2001 and 2002 level for 10
years.
Sell-off crown corporations.
•
Zero net gain for sell-off of
Potashcorp.
•
Sold off SaskOil. Sold off
SaskPower coal and natural
gas assets. SaskPower buys
back energy inputs at world
price and bills citizens.
A publication of National Farmers Union, 2717 Wentz Avenue, Saskatoon, SK S7K 4B6 Phone: 306-652-9465
Potashcorp obtained $85 million
in future income tax deductions
when privatized even though as a
crown company, it paid no income
taxes.
Page 4 of 4
Norway Government
joint projects with global
corporations.
Ethics
•
Canadian based companies,
such as Talisman,
PetroCanada, and Nexen have
operations in Norway.
•
Citizens pay high rate of
income tax but have one of the
highest disposable income
levels in the world.
Wealth fund does not hold shares in
companies which they regard as in
violation of human rights or
degradation of the environment.
•
Potash Industry/Potashcorp
Potashcorp paid 6% income tax on
35% - income tax rate on middle
$506 million of Canadian income
income wage earners,
miners, hospital workers, etc. in 2009.
Zero income tax on half of stock
option income of management and
Board of Directors.
Saskatchewan Government
5 % GST on citizen purchases.
Zero GST.
Restricts union rights.
Potashcorp ethics have been
questioned for purchase of
phosphate rock with zero benefit
to the people (Sahrawis) of
Western Sahara who are
“subjected to grave human
rights violations, such as torture,
forced disappearances and
arbitrary detention”^ by the
occupying Moroccan forces.
Cuts or claws-back funds to inner
city poverty organizations.
Will not invest in Walmart
because of its human rights
violations (anti-union
practices).
Commitment that PCS Head
Office is in Saskatoon not
honoured in practise.
Conflict of
Interest
Government Ministers that
allocate the resource wealth can
personally benefit by subsequent
corporate appointment to the
executive or Board of Directors.
• Stock option benefits can be
worth millions.
A publication of National Farmers Union, 2717 Wentz Avenue, Saskatoon, SK S7K 4B6 Phone: 306-652-9465
Some Potashcorp Board of
Directors had strong
connections to Devine govt.
•
Paul Schoenells – Former
Devine Govt. Minister
Page 5 of 5
Norway Government
Saskatchewan Government
•
Transparency
Transparent wealth fund.
•
Cites commercial contract
confidentiality.
Potashcorp reports
segmented potash results.
The highest rating possible.
•
Environment
Policy
Dwain Lingenfelter who
was an NDP Govt. Minister
was appointed to the
Executive of Calgary Oil
Company Nexen which later
acquired SaskOil.
Potash Industry/Potashcorp
has been a Board
Member of Potashcorp
for 18 years. He received
an oil industry executive
position after he left
government.
Preserve environment for future
generations.
North Battleford natural
gas and electricity plant
contract not disclosed even
though citizens pay the bill.
Environment is given token
Profit first, environnent distant
consideration and the problems left second.
for future generations after the
• Movement of salt and
resource revenue runs out.
minerals from tailings
• Economy first, the
could contaminate major
environment a distant
fresh water aquifers.
second.
• Tailings piles will be
•
“A federal report on fresh
water describes a prairie
water supply-demand
balance that looks like a
disaster in the making.”*
A publication of National Farmers Union, 2717 Wentz Avenue, Saskatoon, SK S7K 4B6 Phone: 306-652-9465
future generations’
problem, after wealth is
gone.
•
New Brunswick mine has
no tailings pile. ( different
type of mined deposit to
Saskatchewan)
Page 6 of 6
Norway Government
Climate
Change Policy
Saskatchewan Government
Encourage industry to reduce
carbon footprint by taxing carbon
emissions.
•
Province emits 74 million tonnes of
carbon a year.
•
Paid Brazil $1 billion to aid
in preservation of Amazon
rainforest.
•
One of highest per capita
emitters in the world.
Goal is 20% below 2006
levels by 2020
Potash Industry/Potashcorp
Industry is large consumer of
electrical energy and natural
gas.
•
Potashcorp – has
electricity cogeneration
plant at Cory mine.
Goal is 10% below its 1990
levels by 2012.
Fails to meet Canada’s
• Goal exceeds Kyoto
Kyoto commitment of 6%
commitment. (Norway
below 1990 levels by 2012.
purchases carbon credits).
September 23rd, 2010 Western Producer article by Barry Wilson, Ottawa Bureau
•
•
^
Western Sahara Resource Watch
Quality of Life Indicators
Norway
Health Care
Universal healthcare, user fees
limited to $324 per year.
Dental services covered until 21
years old.
Prescription drugs – State and
patient share cost.
Education
Post-secondary education is
accessible.
(No tuition fees for university or
college).
Saskatchewan
Universal healthcare – no user fees.
Dental services covered for children
if family income under $29,291.
Potash Industry/Potashcorp
Increases profits as medical
benefit costs are lower for
Canadian employees than U.S.
employees.
Fragmented programs for some.
Costs can be serious hardships for
families.
Post-secondary education is a cost
barrier for many students and their
families.
•
Industry benefits from publicly
educated workforce.
Many students graduate with
A publication of National Farmers Union, 2717 Wentz Avenue, Saskatoon, SK S7K 4B6 Phone: 306-652-9465
Page 7 of 7
large debts.
Quality of
Life
Ranked first seven times.
•
Highest average
disposable incomes in the
world.
Canada ranked first 8 times but
many First Nations communities
rank among the lowest in the world.
Many of its citizens are
marginalized in poverty including
children and working low income
due to lack of program money and
neglect by government.
•
Leadership
An example for the world.
No aboriginal employment
programs.
Among the highest per
capita crime rates in the
country for its two largest
cities.
None for the last thirty years in
resource wealth capture.
A publication of National Farmers Union, 2717 Wentz Avenue, Saskatoon, SK S7K 4B6 Phone: 306-652-9465
For the maximum benefit of the
few and foreign capital.
Page 8 of 8
Vision for the Future and First Steps
Saskatchewan
1. Environment policy that eliminates risks to our water and
land.
•
First step is a full environmental review of our resource
industries that involves citizen environmental groups.
•
Environmental citizens’ organizations must be funded
by wealth savings fund to conduct an independent review
of the industry reports.
2. Citizens Fair Share of Our Resource Wealth is saved and used
to build strong healthy communities now and in the future.
•
Revise immediately the resource royalty structure to
capture at least 50% of the resource wealth for the benefit
of all citizens.
•
Convene a broad Public Commission that includes policy
experts from Norway, the Canadian Centre for Policy
Alternatives, Sask. Environmental Society, First
Nations, minersʼ unions, National Farmers Union,
health professionals, and anti-poverty coalitions.
•
Citizens must demand equitable results and not be
deterred by ideological propaganda. The future of
Resource Industries
1. Must put protection of the environment first.
•
Industry long overdue for a complete
environmental review.
•
Must disclose environmental measurements and
mitigation results yearly in public meetings.
•
Potash Industry must dispose of their mining
waste underground as they mine.
2. Must share the resource wealth of this province with
the citizens.
Saskatchewan is in their hands.
A publication of National Farmers Union, 2717 Wentz Avenue, Saskatoon, SK S7K 4B6 Phone: 306-652-9465
Page 9 of 9