Monday, January 20, 2003

Time to start worrying about Olympic cost risks
By Paul Willcocks
VICTORIA - It's time to start getting nervous about what the Olympics could cost us.
Not panicky. The Bid Committee and the province get pretty good marks for the planning so far.
But nervous, because without a great deal of debate provincial taxpayers have now been committed to spend $1.3 billion on the Games.
And the province's auditor general says the Games' financial plan relies on extremely tight management and good luck. And a business plan based on good luck and fond hopes can be deadly.
In case you haven't been paying attention, here's the basics. The IOC will award the 2010 Games in July, choosing between Vancouver, Salzburg and Pyeongchang, South Korea.
If they come here, we're on the hook for the costs. The Games committee figures it can build the venues for about $620 million. Running the actual events - staff, computers, security and all - will be $1.5 billion. Improving the Sea to Sky Highway and a contingency fund add another $817 million.
So all in, the Games will cost $2.9 billion. (That doesn't include the convention centre expansion, or a transit line to the airport.)
You don't have to pay all that. The Games will get money from ticket sales, sponsorships and TV rights. They hope for $1.3 billion. Ottawa is in for $330 million.
But that still leaves $1.3 billion to come from you and me. And we've accepted all the risk if costs go up - as they usually do - or revenues go down
No need to panic. Auditor General Wayne Strelioff examined the bid, and concluded the committee and the province have put together a reasonable plan.
But not reasonable enough. The auditor general spotted some ski hill-size holes in the plans.
The committee hopes to raise $454 million through sponsorships - nine times as much as the Calgary committee attracted in '88, less than half what the Salt Lake committee lined up. Strelioff concludes that reaching the goal will require "favourable circumstances and effective marketing." Any plan that requires favourable circumstances to work is alarming. Life is short of favourable circumstances, especially when you're counting on them. (The committee's plan even includes $28 million in revenue that's to come from some source they haven't even figured out yet.)
The auditor general is also worried that costs have been under-estimated, and that the contingency budget - money set aside to cover problems - is too small. He notes that in most Games, costs skid upward, often for good reasons.
Auditors and accountants are skittish souls, given to picking at details and worrying. That's one of the things that makes them so useful when the rest of us get swept up in the excitement of our next great idea.
Is it going to be worth it? The mid-range forecast is that our $1.3 billion will produce about $376 million in provincial and municipal taxes, over six years. It will create an average 11,000 jobs a year, a significant employment boost.
But only if the province works to get the full benefit of the Games, notes Strelioff. He quotes one of the consultants who did the economic impact studies. "These benefits will not materialize automatically," they said. "They must be earned by a focused, adequately funded and skillfully executed marketing program."
And that could be a problem. It's unclear where the money will come from, especially because the province plans to take about $90 million in hotel room taxes now earmarked for tourism marketing and use the money to help pay for the convention centre.
The stakes are high, and the decision on whether Vancouver gets the Games only six months away. And the auditor general has pointed out some early warnings that taxpayers could be at risk.
It's time we all started paying more attention to the risks, and benefits, of this bid.
Paul Willcocks can be reached at

Campbell must change course to stay as premier
By Paul Willcocks
VICTORIA - That Sunday afternoon press conference likely marked the beginning of the end for Gordon Campbell.
Campbell faced reporters to talk about his drunk driving arrest. He was obviously sad and shaken. He said he was quitting drinking, even though he didn't think he had a problem. He talked sincerely about the pain he had caused his family. And he referred to his father's suicide, victim of depression and an alcohol addiction. That history, he said, makes his actions in Maui disturbing and frightening.
Three martinis, wine, a dinner that lasted from 5:30 until 1 a.m. And then swerving, speeding, roadside sobriety tests, mug shots and a premier falling asleep in a cell. It is sad.
Self-righteous I am not. Could have been me in those mug shots - though not in years. Could have been many of you, I would say. That doesn't make it right, but it should temper the rush to judgment.
But then it started to go wrong for the premier. In little ways, like the admission that he hadn't told anyone in B.C. - not family, not political associates - what had happened. They learned from the media.
Like his inability to say what he had blown on the breathalyzer, although Maui police say he would have been told, could have seen the readout and could have phoned and asked at any time. Campbell should want to know the reading; British Columbians do.
Asked if he had committed a crime, Campbell bobbed and weaved like a politician, when British Columbians were hoping to see a human. A terrible mistake, was the most he would concede.
Asked if he had tarnished the office of the premier, he wouldn't answer, saying only he had tarnished himself. Asked if he would have allowed a cabinet minister convicted of drunk driving to stay in his portfolio, he again refused to answer.
If you're asking people to forgive you, to give you another chance, you need to start by levelling with them and show that you understand what you have done wrong.
And Campbell, despite his obvious sincerity and sadness, did not meet that test.
Campbell has a remote chance of rebuilding trust. The first polls taken after the drunk driving arrest show British Columbians are evenly split on whether he should resign.
What can Campbell do?
He needs to start by learning from this experience, and not just in the 14-hour alcohol counselling workshop that's part of his sentence.
I was amazed by how little sympathy there was for Campbell. He's seen as a man who has little sympathy for others - especially others who don't share his values and views. And he's seen as man quick to judge others and find them wanting, and to demand that they take responsibility for their actions.
And now people are ready to judge in return.
Campbell should take this opportunity to refocus his government. The Liberals have created two imperatives to drive their agenda - tax cuts, and the legislated requirement for a balanced budget by 2004/5, barely two years from today. People hurt along the way are incidental casualties.
The plan relies, fundamentally, on trust in Campbell and his promise that significant sacrifices now will bring future benefits.
And Campbell now should recognize that he has forfeited that trust.
That means he could and should push the balanced budget deadline back two years, a delay the province can afford. He should promise more consultation and fewer hasty cuts. He should pledge to recognize that people make mistakes, and need understanding and support.
He should show he has learned from this experience.
It still might not be enough. Drunk driving has scarred many British Columbians. They've been told - by their governments - that it is a serious crime.
And in coming weeks they will decide if a man who has committed a serious crime can serve credibly as their premier.
Paul Willcocks can be reached at

Canada marches sheeplike towards war
By Paul Willcocks
VICTORIA - It was heart-breaking to watch Defence Minister John McCallum down in Washington last week.
Canada had a rare chance to play a small role in heading off a reckless war on Iraq. But no. Bleating softly, Canada wandered sheep-like down the path chosen by the Americans, drifting off to war.
And at the same time, the Liberals once again insulted Canadians.
The Liberals' position on the coming war has been murky and constantly changing. But they had apparently been against unilateral action against Iraq, while willing to support any military attack backed by the UN Security Council.
Until last Thursday, when McCallum emerged from a meeting with U.S. Defence Secretary Donald Rumsfield and rewrote the policy. Canada will certainly participate in an attack if the UN approves, he said. And we may well join in even if the UN doesn't believe an attack is necessary.
It's a huge change. And it's certainly one that the Canadian people should have heard before McCallum offered the encouraging word to a hawkish U.S. administration.
The timing of Canada's newfound enthusiasm for war was bizarre. On the same day UN weapons inspectors leader Hans Blix told the Security Council the teams had found no evidence of weapons of mass inspection. There are many questions to be answered, he said, but after two months of inspections "we haven't found any smoking guns."
That doesn't mean the inspectors won't find evidence. But so far, they haven't.
And British Prime Minister Tony Blair, the strongest supporter of U.S. action, started downplaying the risk of war, under pressure from within his cabinet. Britain has been the Americans only strong supporter in the rush to war.
McCallum's conversion to the cause also came on the same day North Korea said it was ripping up a treaty on nuclear non-proliferation and pushing ahead with its own nuclear bomb. Neither North Korea nor Iraq should have the bomb; but a nuclear North Korea is probably a scarier prospect.
So at a time when the justification for an attack on Iraq, the support and the urgency were all being reduced, Canada suddenly became more hawkish.
It seems such a stupid move for a country interested in genuine influence, the kind that can earns respect and makes the world a safer place.
The Americans will welcome Canadian support as a small political victory. If the UN Security Council is unconvinced that there is evidence justifying an attack on Iraq, the U.S. may chose to ignore the finding and attack anyway.
But President George Bush has made much of the need for a joint international effort. Only Britain has been an enthusiastic supporter so far. The Bush administration can now add Canada's name to the list of countries prepared to attack without a UN mandate.
McCallum could have withheld that support. That would have encouraged the U.S. to justify any attack in front of the UN. And it would have been a step towards ensuring that all other options had been exhausted before the killing started.
Canada shouldn't poke sharp sticks at the Americans. They buy our goods and support our tourism industry. And despite irritants like the softwood lumber dispute, Americans and Canadians have a great deal in common.
But neither should Canada be a lapdog.
Canadians don't want a war with Iraq, according to all the polls. They have seen no evidence that a war is needed, whether to protect Iraqis or head off an attack on some other country.
There may come a time when war is needed, when some clear threat emerges.
But that time isn't now. McCallum - Canada - had a choice between choosing a course that would allow Canada to make a small gesture toward preserving peace, or a path that would make war more likely.
He took the wrong one.
Paul Willcocks can be reached at