UCP cuts the “length” off arms-length AIMCo
UCP cuts the “length” off arms-length AIMCo
Alberta's $160.6 billion investments and pensions now under a government-controlled cone of silence
Secure in her party’s leadership after earning the support of 91.5 percent of members at the United Conservative Party AGM earlier this month, Premier Danielle Smith isn’t skipping a beat in implementing her government’s political agenda.
The firing of the CEO and the entire board of directors of AIMCo, the arms-length Alberta Investment Management Corporation, was confirmed through a short 9:47 am press release from Finance Minister Nate Horner last Friday.
The entire purpose of the AIMCo Crown corporation and it’s independent board of directors and management is to protect Alberta’s $160.6 billion investments from political interference and agendas. AIMCo manages Alberta’s public investments, including the Heritage Savings Trust Fund, and the pension plans paid into by public sector employees (including the Local Authorities Pension Plan, Public Service Pension Plan, Management Employees Pension Plan, Alberta Teachers' Retirement Fund, and others).
While news of the purge was reported the day before Horner’s office officially confirmed it, no regularly recorded press conferences were held to announce it. It appears that Horner only made himself available for a short scrum with reporters to answer questions about why he fired and took direct control of the arms-length crown corporation.
Even the weekly “Alberta Update” YouTube show from the Premier’s Office hosted by former broadcaster and current McDougall Centre executive director Bruce McAllister made no mention of the AIMCo board firing.
Horner’s press release cited poor performance and increased operational costs as a reason for the mass dismissal, an argument that former AIMCo board chair Kenneth Kroner disputes in a letter to the Finance Minister.
“Over the last week, there have been numerous public statements made about AIMCo’s performance and costs,” wrote Kroner. “I have concerns that these are tarnishing AIMCo’s reputation, which will only make it harder for Albertans to have confidence in the public asset manager, and will create unnecessary barriers for AIMCo in its goal to deliver strong investment performance for Albertans.”
The only journalist Horner appears to have spoken with about this for any meaningful length of time is Postmedia columnist Rick Bell, who penned a single column about the AIMCo takeover last Friday.
The interview with Bell quoted Horner as saying he fired the AIMCo CEO and board of directors so the government could make costs and return on investment line up while “not shoving our potential financial sector outside of the province just because of some ideology of some executive.”
Because Horner only spoke to one columnist about the AIMCo takeover, it’s not entirely clear what exactly he meant by “some ideology.” AIMCo’s opening of investment offices abroad in London, Luxembourg, Singapore, and New York City, some of the world’s most important financial centres, could be one reason for this reaction.
There is some speculation that political opposition to AIMCo’s commitment to Diversity, Equity and Inclusion policies played a role in the dismissal. UCP members at the recent AGM voted overwhelmingly to support of a policy that would end Equity, Diversity and Inclusion as part of hiring practices in government and publicly-funded bodies like AIMCo.
Speaking to the National Post in 2023, AIMCo’s then-Chief Investment Officer Marlene Puffer said that now-former CEO Evan Siddall “walks the walk with DEI in a way that I’ve rarely seen any leader walk, let alone a white male cisgender leader. And he’s proven that with who he’s recruited at the senior leadership level in this organization.”.
But the most likely speculation is that Horner fired the AIMCo leadership in order to allow the UCP government to take more direct control over the assets and investments to pave the way to remove all Alberta workers from the Canada Pension Plan and create an Alberta Pension Plan to replace it.
The creation of another government body “for the purpose of managing and investing all or a portion of Crown assets” made through a cabinet order last week increased speculation this could be the case. It is a huge red flag for Albertans concerned that their retirement savings could be used make billion dollar bets on risky pipeline projects or bail out companies that fail to pay for oil and gas well-cleanup.
Despite low levels of support among Albertans and a process that Pension Plan Engagement Panel chairperson Jim Dinning described as “a renovation from hell,” Horner appears intent on moving forward with plans to create an Alberta Pension Plan. It is expected that federal Finance Minister Chrystia Freeland will very soon release Ottawa’s actuary report in response to the UCP government’s claims that a newly created APP would be entitled to roughly half the funds currently in the CPP.
Until Horner decides to tell us more, the swift firing and direct government takeover of AIMCo and its management of Alberta’s public sector pension plan investments, and the cone of silence that has followed is not exactly a confidence inspiring move.
Putting Stephen Harper in charge of AIMCo?
AIMCo’s board of directors, all who were appointed by the UCP government and appear to have very qualified resumes, was replaced, temporarily we’re told, by Horner as the sole board member.
Bloomberg reported that former Conservative Prime Minister Stephen Harper, who has no experience in investment or pension management, is being eyed as the new chairperson of the AIMCo board. While respected by many Albertans when he left office a decade ago, Harper’s appointment would be a clear signal that the UCP government means to politicize the province’s public investments.
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