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Fair or not, Opposition targets Katz donation(s) as symbol of Tory sleaze

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Danielle Smith

The Wildrose Party strategy for defeating the Progressive Conservative government of Premier Alison Redford when the next election rolls around in 2016 is a variation of the right-wing party's plan when it came close to winning earlier this year: paint the PCs as corrupt and themselves as the only viable uncorrupted alternative.

As a result, we can expect to see a lot more implications and inferences in the Legislature's Question Period like the attack Monday by Opposition Leader Danielle Smith on Edmonton Oilers owner Daryl Katz's ability to perform his duties on the board of the Alberta Investment Management Co., which invests the province's public service pension funds and other huge pools of money.

Smith argued in the Legislature Monday afternoon that Albertans are "uncomfortable" with what the Edmonton Journal termed in its report of her questions as "some potential conflicts" between Katz's role as a billionaire business executive who wants taxpayers to help him build a hockey arena in Edmonton and as a trustee of a large publicly owned fund-management company.

But when one actually listens to what Smith had to say, she's not really talking about potential conflicts very much at all. Rather, between the lines, she is reminding voters about a recently reported political donation cheque to Premier Redford's PC Party signed by Katz that for many Albertans does not pass the ethical sniff test.

"Let me connect some dots," the Wildrose Leader told the Legislature. "Given that a quarter of the government’s election donations are said to be from a single source, and given that source wants $100 million from the government for a hockey arena, and he sits on the board of a Crown corporation that invests $70 billion of assets owned by Albertans, doesn't anyone in this government have a problem with that?"

The Alberta NDP followed a similar strategy, with Leader Brian Mason suggesting Katz's influence had allowed him to successfully lobby for higher fees for pharmacists who give injections -- even though neither Katz nor his Rexall drugstores company employ any lobbyists.

The known facts about Katz's political cheque are as follows: In the closing hours of the 2012 election campaign, the Edmonton drug store and hockey billionaire somehow got several of his business colleagues and relations to each agree to donate up to the maximum allowable $30,000 to Redford's PC party, which at that point looked as if it was about to lose to the Wildrose Party.

According to the PC Party, Katz, his company, three family members and executives with his company, the Katz Group, gave donations of $25,000 or $30,000 that added up to $300,000. But according to a report in the Globe and Mail, Katz took the entire sum over the PCs on a single cheque, and what's more, the total was $430,000.

The PC Party's Executive Director, Kelley Charlebois, told the Journal last week that the party often receives multiple donations on a single cheque.

But if the donation was made on single cheque, regardless of the sum, the optics are terrible. It surely didn't sound to most Albertans as if the deal, however it went down, met either the letter or the spirit of a law limiting political donations to $30,000.

Moreover, it was also true, as Smith stated, that Katz was hoping to have Alberta taxpayers contribute to a swoopy new half-a-billion-dollar hockey arena in a nice part of Edmonton for his currently locked-out professional hockey club, the Edmonton Oilers.

But the argument that this can all be tied together in a way that would affect the way Katz does his job on the AIMCo board seems more tenuous. But that's not Smith's real point, anyhow.

Smith's goal was to tie the government in the public's mind to the idea of unsavoury deals among government insiders. It's hard to know for sure, but I suspect she has largely succeeded. Her party's strategy will continue to be to call the government corrupt until the idea gels and sets in the public consciousness.

For that reason, we are going to hear many suggestions like this over the next few months and years and Finance Minister Doug Horner's huffing about how ridiculous and unfair it is, or his suggestions Katz might have grounds for a defamation suit, won't make much difference at all

This is a serious problem for the Redford Government because if it hopes to survive once again, its goal during this term of office must be to come up with a strategy for appearing to have dealt with the perceptions that almost led to its demise at the polls last April.

That was the point of the public service whistleblower legislation introduced yesterday: to put to sleep the lingering sense something is ethically wrong with the way the Alberta PCs do business.

And that was most certainly the point of the surprise announcement late yesterday that Elections Alberta would launch a formal investigation of the legality of the Katz crowd's donation(s). Given the current state of the law governing Elections Alberta's powers, however, it's not at all clear if the conclusions of that inquiry will ever be made public.

The opposition parties, of course, will do everything they can to keep the perception in the front of the public's mind.

Alas for the Redford Tories, and for Katz, this situation is rather like the proverbial case of Caesar's wife: She had to be above suspicion, and so does he.

Pretty obviously, the best thing for the Redford Government from a political perspective would be for Katz to quietly step aside from his AIMCo role until the other matter has been settled … or forgotten.

That kind of climb-down would be a hard sell for the Tories, however, as it's not a way they've ever had behave before in this province, where hitherto they could do whatever they pleased and be re-elected with metronomic regularity.

Whatever her personal religious convictions may be, the Opposition leader is now doubt less praying this particular old Tory habit dies hard.

This post also appears on David CLimenhaga's blog, Alberta Diary.

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