On distributive options

Both the Saskatchewan NDP and Saskatchewan Party have released their election platforms. And for all of the electioneering around what might be anticipated outside of those, we can already tell plenty from how each party has framed its flagship promises.

Take, for example, how the parallel Crown rebate promises from each party actually work.

 The NDP's plan involves using SGI's existing surplus to provide lowered rates and rebates:

Lower SGI rates by roughly $85 per vehicle and provide an immediate $100 rebate to all policy-holder...

Those benefits would then reach 800,000 licensed drivers: see SGI's latest annual report (PDF). The total cost is projected at $120 million (see the fiscal tables here) (PDF).

The Saskatchewan Party, meanwhile, is offering a 10% rebate on SaskPower bills:

A re-elected Saskatchewan Party government will introduce a one-year 10% rebate on electricity charges on power bills for all SaskPower customers...

The 10% rebate on the electrical charge on customer’s SaskPower bills will come into effect on customer’s December 2020 bills. Customers will receive monthly savings on their bills for 12 months starting in December 2020.

But while that has been framed in terms of its effect on residential and farm customers, the vast majority of the effect - and cost - involves incentivizing the use of power in the commercial and industrial sectors.

According to SaskPower's latest annual report, the province's $2.6 billion in electricity sales include $792 million to 130 power utilities (e.g. Saskatoon and Swift Current's local utilities); $571 million to just under 399,394 residential accounts; $521 million to 63,757 commercial accounts; $451 million to 19,466 oilfield accounts; and $190 million to 57,978 farm accounts.

The average benefit of $260 million in rebates would then be: $142.97 per residential customer (not the $215 specified in the platform); $327.71 per farm customer (not the $845 stated in the platform); $817.17 per commercial customer (unmentioned in the platform); and $2,316.86 per oilfield customer (unmentioned in the platform). And in the latter cases, it's not hard to anticipate that the availability of the rebate would actually incentivize the use of less-efficient power use options for as long as the price of power is being artificially held down.

The end result is that the Sask Party's plan costs twice as much as the NDP's to reach just over half as many people directly, with a built-in bias toward commercial interests generally (and the oilpatch in particular). Needless to say, it's not hard to see which of those options is better targeted at making life more affordable for people. 

Now, I'd think it's fair to question whether either of these planks should be considered a top priority given all of the other areas in desperate need of public investment. 

But it's certainly worth noting that the Saskatchewan Party is looking to spend far more Crown money to smuggle giveaways to the oilpatch and the corporate sector. And both the province's balance sheet and those of its families will be far better off with the NDP's choices.