With its surprise decision to cashier the entire board and the top executive of the supposedly independent Alberta Investment Management Corp., we see once again that the United Conservative Party Government is determined to control everything, everywhere, all at once.
And if you’re an Albertan, that includes your retirement savings in the Canada Pension Plan Investment Fund.
Indeed, we can be certain this shocking announcement has something to do with that scheme, because chronic underperformance by AIMCo, as the provincial Crown investment corporation is commonly known, has been a frequent target of critics of the UCP’s planned pension grab.
Under the headline “Restoring confidence in AIMCo,” the government said in a terse and unexpected news release yesterday that “after years of AIMCo consistently failing to meet its mandated benchmark returns, the Minister of Finance will be making changes to restore confidence in Alberta’s investment agency.”
But why now?
The release complained about a 96-per-cent increase in management fees at AIMCo between 2019 and 2023 and a 29-per-cent increase in the number of employees while the Crown corporation managed a smaller percentage of funds internally – although the news release made no effort to explain exactly what that last point meant.
“Alberta’s government has decided to reset the investment corporation’s focus,” the news release said mildly. “All board appointments have been rescinded and a new board will be established after a permanent chair is named.” That, according to the release, is supposed to take place within 30 days.
“In the interim, President of Treasury Board and Minister of Finance Nate Horner has been appointed the sole director and chair for AIMCo, effective immediately” – which is not really reassuring for a supposedly arm’s length company managing $169 billion in pension investments.
Notwithstanding the 30-day promise, a cabinet order set Mr. Horner’s term as chair of the AIMCo Board to run until the end of September 2025.
Accusing the UCP of wanting to control everything, everywhere, all at once was a clever tribute to the 2022 comedy-drama movie of the same name first used by NDP Opposition Justice Critic Irfan Sabir last spring to describe the UCP fiddling with its own fixed election date law to give itself a little extra time in office.
“Danielle Smith said during the election that Albertans were her bosses,” added Rachel Notley, who was leader of the Opposition at the time, “but it is clear now that she intends to be the boss of everyone.”
Those lines could certainly be applied with similar effect to yesterday’s bombshell.
A comprehensive article in The Globe and Mail – which, sorry, is located behind a paywall – revealed that in addition to the 10 board members referred to but not named in the news release, Chief Executive Officer Evan Siddall and three other unnamed executives had been canned.
Mr. Siddall, who was appointed CEO on July 1, 2021, with a mandate to turn the company around after its big trading losses during the pandemic, had been the long-time president and CEO of the Canada Mortgage and Housing Corporation. Judging from his Wikipedia biography, he seems to have attended meetings of the World Economic Forum and the Bilderberg Group, which must have made certain MAGA-minded members of the UCP Caucus feel as if they had ants in their pants.
Or maybe it was Mr. Siddall’s decision to let Alberta’s teachers have a limited role in the management of their pension fund, which had been grabbed by the UCP in 2019 and handed over to AIMCo amid great controversy. Indeed, some of those additional pension employees the government was complaining about likely came from the management arm of the teachers’ pension fund.
Whatever happened, NDP Finance Critic Court Ellingson told the Globe that Mr. Siddall and some of his colleagues showed up at a public meeting of the standing committee on the Alberta Heritage Savings Trust Fund on Wednesday and there was no hint anything was afoot.
Mr. Ellingson said in a statement sent to media yesterday afternoon that firing the entire board and the CEO is too drastic a measure for this just to be about AIMCo salaries “when this government passed legislation to remove the caps on salaries for board members.”
“The premier herself appointed some of these AIMCo directors,” he said. “The finance minister himself said this spring that AIMCo was doing a good job.”
He also argued that even in a temporary role, having a partisan politician at the helm of a supposedly arm’s length agency investing 375,000 Albertans’ retirement savings is troubling.
It certainly seems to have unsettled some in investment circles. The Globe quoted the director emeritus of the International Centre for Pension Management at the University of Toronto’s Rotman School of Management, Keith Ambachtsheer, saying the move “should be construed as a government takeover of (an) asset pool that belongs to the people of Alberta.”
Mr. Ellingson argued “AIMCo’s poor returns are a clear reflection of the UCP’s incompetence.”
“We have raised concerns about their poor returns for years, and we’ve noted AIMCo’s returns have been below that of the Canada Pension Plan,” he said. “Until now, the UCP even proposed using AIMCo to manage the proposed Alberta Pension Plan. Any such APP scheme should now be completely off the table.”
Count on it, though, the opposite is true. If this indicates anything, it’s that the UCP still covets the CPP’s investment funds and saw AIMCo’s returns as an impediment to that ambition. Nor does the party value independent minds in positions of oversight.
Interestingly, another Order in Council published yesterday “approves the incorporation of a Provincial corporation for the purpose of managing and investing all or a portion of Crown assets.”
This proves once again, how people cannot trust the UCP to look after their pensions. They already lost $4 billion in pension money via AIMCo. The Heritage Savings Trust Fund, also managed by AIMCo, saw losses of over $3 billion. With the UCP, they will make sure that Albertans can’t retire. Nate Horner is now in charge of AIMCo. That’s like the fox being told to guard the henhouse. Albertans have told the UCP that they staunchly oppose an Alberta Provincial Pension Plan. Why are the UCP pursuing it? Under Pierre Poilievre, it won’t be any better. The CPC lost $35 billion of people’s life savings in the income trust scandal. It just gets worse and worse with Danielle Smith and the UCP.
I watched parts of a session of the public accounts related to the Heritage Trust Fund, and AIMCo execs had a very far from stellar performance. They took questions from the public in various formats, but for me the best one was a caller asked why the S&P 500 consistently had double digit gains over the last number of years, while the gain in the Heritage Trust fund was very poor. The response was a whole bunch of tap dancing around the issue and essentially a bunch of garbled fluff. Meanwhile as I had observed in the LAPP plan that I am drawing a pension from, AIMCo lost 5% last year. During that time salaries and cost to operate the plan skyrocketed. I found discussion paper on executive salaries at AIMCo and some where making up to $5m per year, just to lose money. I think the embarrassment of the numbers and the response demonstrated the other day, left the Minister no other option than to fire the board. While he is not supposed to be directly involved in the plan, he is the Minister responsible for AIMCo.
The UCP government is swiftly moving from clownish ineptitude to outright danger to Albertan rights and economic wellbeing. This is frightening. I am alarmed that this obvious grab for our cash is even possible under existing legislation. Any Albertan who is counting on their CPP to be there for them when they retire should be extremely concerned by this. And isn’t it convenient that Marlaina is on another taxpayer funded junket to Dubai when this was announced?
In any normal universe the Minister of Finance would be forced to fire himself!
Let’s start with one of the most important questions here: who appointed most of these people? The clarity of that answer should cut through much of the political confusion the UCP is trying to create here. It was the UCP itself. They created the problem.
We should wonder about the reasons for that a bit more, but it is likely a sign of administrative incompetence. Not surprisingly, this is what happens when people who don’t know what they are doing try to control or micromanage too much.
Maybe the UCP l will fix the persistent problems with Alberta’s pension management here, but I suspect they will likely just end up replacing one group responsible for sub par performance with another one. And new problems will be created in the attempt to get rid of old ones, because the incompetent ones here are the ones overseeing things, who can’t so easily be fired or replaced.
As a LAPP and CPP pensioner I do not like this at all, when are we as Albertans going to stand up to this government and take back control of OUR money before she uses all of it to get control of our pension money to form Alberta pension and Alberta police. We must start to organize and protest every day until she relinquishes control of the minutea of our lives. I lose those pensions it’s game over for me.
If you lose you pensions, it should be game over for them. As H. L. Mencken wrote: “Democracy is the theory that the common people know what they want, and deserved to get it good and hard.”
Idontlikethis:
I hear you. And I agree. However, too many Albertans wholeheartedly support the UCP government and don’t know or don’t care about specific issues. They also don’t care about public pensions or the people who collect them. Protests don’t work with dictators. I live in rural UCP/TBA country. People here think she and the UCP are doing a terrific job. They admire her balls and aggressiveness. They believe the rhetoric. They believe the UCP are ‘getting things done’. They hate Trudeau and cheer when she fights with the federal government. There are so many rural ridings in this province who think the same way. They engage on social media and parrot the Smith/Poilievre spin. I would love to be wrong, but I know what I see and hear in my region.
This sudden change comes just days after a big change south of the border. By golly, how long will it be before rumors start to fly here about *lovely gated communities* being built in the Special Areas of Alberta to welcome newcomers? (Oh wait, they want more temporary foreign workers; no they don’t; yes they do.) Also, no need for panicky rumors about the gov’mint seizing our pensions because that’s already on their agenda, which they announced months ago.
When are we allowed to make words like “dictator” and “fascism” popular again?
I don’t see anything in Nate Horner’s resume that makes him qualified to take charge of AIMCO, or to be a finance minister. I would say the retirees’ pensions are now at a high risk. Melainia and co. continue their destructive journey.
It’s not Nate Horner’s resume that matters, but his pedigree. He’s not the sharpest knife in the Horner cutlery drawer, but it is the HORNER cutlery drawer. DJC
Little Nate Horner, sat in the corner, eating his pension pie….. He stuck in his thumb, right up his bum and said “What a great minister am I!”
A question – wasn’t creating a provincial corporation the tactic the UCP used to insulate the energy war room from freedom of information requests?
Mel: You are correct and you are making a very good point. DJC
That’s it. We pensioners are screwed.
Danielle Smith is the worst kind of micro-manager. She, or somebody who tells her what to do, has decided she needs control of our pension money. Why?
Well, there’s her knee-jerk reaction to “big government.” The noise about too many employees, too much of the fund management contracted out (wait—what?), management fees almost doubling (the horror!!!).
Refresh my memory. Who, exactly, changed AIMCo from a low-risk investment agency for the Alberta Pension Plan to, in essence, a wealth-management corporation? Who told ‘em to “diversify”—leading to those multi-billion-dollar bad bets?
That’d be enough to convince the Empress of Oilberduh, she who has a degree in economics from the Calgary School* she could do it better herself. But I’m convinced there’s more.
(*guiding principles of the Calgary School: 1) give the oilpatch what it wants, when it wants it. 2) Alberta would be better off alone.)
Global oil prices have started to soften, now that the twin shocks of the Covid crisis and Putin’s war on Ukraine have more or less worn off.
https://www.cbc.ca/news/canada/calgary/oilpatch-2024-prices-gasoline-1.7373407
Worse for Oilberduh, global oil consumption is slowing gradually. That’s bad news for the bitumen industry (BC’s infant LNG industry is in similar trouble). Bitumen will be among the first to lose market share, due to cost of extraction, cost of upgrading, cost of refining and high carbon pollution per barrel produced.
https://www.cbc.ca/news/canada/calgary/donald-trump-president-alberta-economy-energy-tariff-oil-1.7375503
https://www.theguardian.com/business/2024/sep/12/oil-demand-growing-at-slowest-rate-since-height-of-pandemic-iea
https://www.canarymedia.com/articles/liquefied-natural-gas/lng-is-controversial-canary-media-fact-checks-5-big-claims
So, as our host asks—why now? Why screw over Alberta pensioners now? Well the unstated reason is obvious. It’s called the “Site Liability Incentive Program,” better known as R-Star. Danielle Smith still intends to SLIP $20 billion to oil company owners so they can afford to clean up their mess. God knows, with oil prices falling, or falling soon, or maybe falling some day, the poor dears need all the help they can get.
My ulcer bleeds for them.
Now that Trump has the power to “drill baby drill”, I wouldn’t bet on things getting better for Alberta; remember that massive expansion of fracking in the U.S. is what contributed to the price crash ten years ago. And if Trump ends the war in Ukraine (by giving Putin what he wants) will that mean Russian oil will start to flow again into world markets, thus further suppressing the price (particularly for the discount-hampered bitumen produced in Alberta).
Unbelievable, yet when you examine the last 5 years of UCP heavy handed overreach into every ministry it is actually par for the course. Much like Harper’s reign of terror in Ottawa, Smith and her entitled cohorts are centralizing all power through the Premier’s office. Authoritarian, dangerous and certainly a precursor to grabbing Albertans’ federal pension money. Imagine placing billions of dollars in the hands of a Finance Minister with a 2 year diploma in agriculture. An election can’t come soon enough.
Bingo. Well said.
Wouldn’t any self respecting “Minister” of Finance resign when his most important portfolio file became public as mismanaged? Nah!
You want the UCP cabinet theme song with that? Why, colour us Alabamaberta! https://youtu.be/UrgpZ0fUixs?t=3
Hello DJC and fellow commenters,
Yup! I’d say that your idea that the Danielle Smith is slouching towards getting her hands on CPP money which is, after all, money belonging to those who paid into CPP. this certainly raises concerns about increasing investment in oil and gas to the greater exclusion of other kinds of investments.
As DJC and Mel pointed out, it is interesting, perhaps raising some suspicions about motives, that there are now plans to create a corporation to manag investments. The likelihood that the soon-to-be-created corporation would be as opaque as the War Room and impervious to freedom of information requests or any other kind of scrutiny is exceptionally concerning.
Does anyone know how the executive of Aimco is chosen? Does the board of directors of AIMCo or maybe the UCP government choose the executive?
There is an interesting contradiction going on now within the conservative rank and file, which will come as a shock to no one here.
In my past social media political interactions, conservatives have been shrieking about the fantastical possibilities of an Alberta Pension Plan, claiming that AIMCO will solve all problems. I would always counter that the CPPIB is a well run operation and administration duplication would have costs.
It must be terribly indigestible for UCP supporters to now see that AIMCO is in fact not performing up to expectations unless one likes low returns on their investments. I don’t see any positive outcomes from this action. Even if temporarily, having one person, a politician to boot, in charge of the fund is either pathetically laughable or laughably pathetic.
These guys want to take our money out of the well-managed Canada Pension Plan and hand it over to an outfit even they don’t trust. Are they sane?
“Are they sane?” Bill, the short answer’s “No.” At best, they’re brainwashed by Libertarian BS that oozes north from the US.
The CPPIB has outperformed AIMCo for years now. My financial advisor works for a privately-owned, for-profit corporation, and, unlike the clods at AIMC0, his advice has been generally good and often excellent. So guv’mint versus private isn’t the whole story–CPP has been well-managed and generating good returns since the plan was updated (i.e. the enabling legislation modernized) in the ’90s.
Danielle Smith and her #1 handler, Rob Anderson, are not competent. Either that, or they’re deliberately trying to break everything in Alberta that more-or-less works–especially anything labeled “government.” They firmly believe that governments can do nothing right, and businesses can do no wrong. It’d be pathetic, if it wasn’t so disgusting, how the Utter Chaos Party is determined to prove they can’t do anything right.
Mike J Danysh: The UCP are a hybrid of different abysmal governments. The Social Credit Party, and their offspring, the Reform Party, Ralph Klein’s PCs, and MAGA. Add some Jordan Peterson and Tucker Carlson into the mix, with some hefty endorsement from Postmedia, and it just turns into a foul mess. Sadly, the UCP were enabled to cheat and lie, and it isn’t going to get better. The UCP wants power and control, regardless of the harmful consequences. At this point, Danielle Smith seems intent on having a longtime stronghold on power. She will not care. The opposition, including with the NDP and Naheed Nenshi, are being silenced. We have a genuine dictatorship in Alberta. Democracy doesn’t exist anymore.
I’d say Smith is up to something which will not benefit those who contributed to the pension plan. What could possibly go wrong? Wonder where they plan to invest the money? How many staff will be fired? Will they turn it over to another company to manage?
I think they are going to use the pension money for some pie in the sky plan which will cause a lot of the money to be lost. None of the UPC players strike me as particularly up to date on the science of investing large amounts of money.
Yes its true sometimes governments put money or assets into an entity so that the people and nosey bloggers can’t get answers.
Wonder who gets to make up the looses? Well at least some of us could go to Alberta and watch the court cases.
The concern with our provincial government taking over the CPP has always been that they will turn the pension into a slush fund for their favorite causes (oil and gas).
In that vein, it will be interesting to see who the UCP replaces AIMCo staff with. In my mind they have two choices:
Choice One: Replace the board with competent, unbiased staff. They will, presumably, post better investment results than what the outgoing staff did, and bolster the UCP’s case that they can run an Alberta Pension Plan. This will, however, be seen as a betrayal by their followers, who look covetously at all those funds that could serve their interests so well. Alternately,
Choice Two: Replace the board with the hacks who are pushing for the APP in the first place. This will satisfy their base, but weaken the case for taking over the CPP.
I believe the board was replaced as part of a longer term project to finance the oil sands. The Pathways Alliance is probably having huge problems getting reasonably priced financing for their project. I believe the UCP wants to provide all the financing build the Carbon Capture Facility. I am sure the fired board, would have wanted market rates if they had even been interested in providing financing.
Bill: This makes more sense than any explanation I have heard. It certainly sounds as if the Board refused to approve some project the government was championing than the lame excuses that have been offered up to now. DJC
Sadly, severance packages will probably come with non-disclosure agreements that will prevent the former board members from ever confirming Bill’s suspicions.
Funnily enough, Bob, that’s just what I was thinking as I pondered what to say next about the AIMCo mystery. DJC
In other news, the UCP brain trust announced Friday (of course) the UNLIMITED killing of lynx, wolverines etc for the purpose of “collecting data so we know how many there are”. I kid you not. Hey kids, when frying up your lynx in the deep woods, don’t forget to add a dash of oxy-moron. Or if you prefer, go heavy on the moron.
The UCP are operating like Orban’s regime, taking over public assets – healthcare, education and now pension plans – and then selling them as part and parcel to the corps with UCP connections. With journalism sown up by Canadian and US media giants, the truth will never come out. We live in a corporatocracy, not a democracy, where the corporate class owns the economy, major political parties, media, government and all major assets of society. The radical right has crushed the people in the western world.
Blame Jack Mintz for all this.
He is the crony in the background, loaded up with O&G stocks and advises the UCP party on economic policy. He is well known for his anti- public servant rhetoric and is on record to suggest that “the public pension plans are too rich” in Alberta and Canada. He advocates for more private control of public pensions.
Why? So that politicians that are in bed with private corporations can access public pension money to feed their friends in the private sector. Mintz is a snake in the grass.
https://ca.finance.yahoo.com/news/jack-mintz-public-sector-employment-100024285.html
Not-a-real-doctor Mintz will be leeching off the public teat as long as he draws a breath. Sad.
Cool: Dr. Mintz has a PhD. PhDs, in my opinion, are the real doctorates. The rest of your observation is a fair comment, in my judgment. DJC
Thanks for the link, Dr. (I think). It was a pretty depressing read.
I believe Jack Mintz is a professor at the Calgary School of Public Policy, where I think I heard Danielle Smith earned her degree. I am wondering if she took any classes from Dr. Mintz.
Oh by the way, Smith and the UCP want access to all your CPP money (so they can lose it).
Smith and the UCP want to be able to finance anything that the Oilsands Companies want. With the new “Green Lending” practices the oilsands projects will pay a premium price to borrow money. Smith and the UCP will give them below market prices.
The big loss was several years ago, so I believe they were fired for their reluctance to even consider the oilsand projects.
Hello DJC and fellow commenters,
Thank you YYCLefty for letting us know about the announcement that the Alberta government will allow unlimited killing of lynx, wolverine, otters, and river otters to find out how many they are. I cannot figure out how killing species can tell how many there are. That is ludicrous.
According to Global News (link below), the Minister said, “It’d be really hard to replace that local knowledge [of Alberta’s 1,600 trappers] by having maybe a few biologists run around trying to gather data.”
I think that statement tells us how the members of Alberta’s elected government perceive things. First, they don’t think that the environment or wildlife that inhabit it are of any value, certainly not worth the cost of studying it or ultimately of trying to preserve it.
Second, they have no idea of the value that the environment and wildlife provide to humans.
Third, they have no respect for expertise since this comment clearly denigrates biologists and statisticians who might help to interpret the results the biologists and find, along with other professionals who might be needed to conduct a scientific study. It shows contempt for educated specialists who do scientific research to come up with information. The comment reminds one of Trump’s comment to the effect that he loves the poorly educated.
The words “having maybe a few biologists run around” suggests that biologists do not actually do evidence gathering and analysis. It implies that they simply show up and do nothing. This is clear proof that these politicians are not interested in any result that is inconsistent with the so-called “evidence” that they want so they can shore up their preferred results.
One cannot help thinking about the cod and the Department of Fisheries and Oceans conclusions that the cod stocks were prolific and that fishers could continue to harvest and unlimited number of fish. This “conclusion” was drawn despite the fishers’ clear observation that the fish they were catching were smaller and more difficult to find.
This cod situation was wholly political because the federal government did not want to upset fishers, largely Newfoundlanders, who would be angry that their livelihood was being destroyed. Finally, John Crosbie, the Minister of Fisheries and Oceans, had to tell the fishers, and everyone else in Canada the truth and announce the moratorium on fishing cod.
The Global News article states that the last study of wolverines, conducted in 2003, concluded that there were only about 1,000 breeding wolverines. Thinking about that number, it doesn’t make any sense to allow unlimited trapping of wolverines. And who knows if the trapping of the other animals in the Minister’s list makes any more sense.
https://globalnews.ca/news/10859096/alberta-forestry-trapping-limits/
Excellent points about estimating demographic parameters of wild animal populations. I’ve actually done some work on this, and the last means of collecting data that I would have contemplated is killing every animal that I encountered of the species I was studying. You can collect population data from killed specimens, such as monitoring the number of run-over snakes you encounter on a given stretch of road over a period of time, but the first thing such data tell you is “there’s fewer of them now than there were before”.
But as you point out, conservatives are allergic to expertise.
Hello DJC and fellow commenters,
Thanks Feelgood for reminding us how divisive Jack Mintz continues to be. Public service workers, as you say, are one of Mintz’s favourite targets. Most public service workers aren’t actually that well paid. And that includes members of the military. My Mom worked at the secretarial and “confidential exclusion” (not permitted to strike and not permitted to join a union) level of the federal public service for about 45 years. Her defined benefit pension was not enough to live on and she did not live an extravagant lifestyle by any means. My Dad’s military pension, after almost 30 years (almost all military service with a short stint of about 2 years in the public service) was definitely nowhere enough to live on. He retired from the military because there was a mandatory retirement age based on rank.
Jack Mintz’s myth about rich public service pensions serves only to perpetuate jealousy and anger at public service workers who work hard and provide necessary services.
It creates divisiveness among ordinary people are working to survive in a difficult financial environment dominated by large, and often rapacious, corporations. This has to stop, and we all need to be well-informed on what writers and academics who support corporations at the expense of ordinary people are trying to promote.