What are Your Thoughts on the Federal Election Results and What it Might Mean for the Energy Industry?
Election 2019 was memorable on many fronts. First and foremost, it was no slam dunk for Justin Trudeau, in fact quite the opposite. A Prime Minister who two years before the vote looked like an unstoppable political force was reduced to a minority government and bar a poor performance by Conservative Leader Andrew Scheer could have ultimately ended on the opposition benches.
Those very benches have been repopulated by the Bloc Quebecois. Effectively a party who was near extinction after the 2011, they came back with a roar in this campaign. From 10 seats in 2015 to 32 in 2019 they had a great run. The Bloc pulled support from all parties and virtually abandoned any pretense of being contemporary advocates of separatism. They are a Quebec first party very much in line with the provincial government of Francois Legault.
It was an election where parties with platforms promoting more forceful action on climate change received over 63 per cent of the vote. Though no one party got that support it suggests that the Trudeau government in this minority setting will be encouraged to go further on advancing environmental policy rather than stepping back from it. Early pronouncements from the new government suggest that will be the case. One post-election headline screamed – “Trudeau: Climate and pipeline are priorities after election.”
“The Liberals were shut out of seats in Alberta and Saskatchewan. All but one seat in that region went to the Conservatives.”
Trudeau’s message of a managed transition from current dominant sources of energy, the ongoing commitment to building the Trans Mountain pipeline, to a less carbon intensive environment is not playing well in all of Canada. Arguably Trudeau’s fiercest opponent over the last number of months has been Jason Kenney the Premier of Alberta. Kenney along with Saskatchewan Premier Scott Moe have been omnipresent reminding the Prime Minister and Canadians that the resource sectors matter. Threaten them, as they define it, at your peril. What emerged through the election was a picture of a country more fragmented now than it has been in twenty years.
The Liberals were shut out of seats in Alberta and Saskatchewan. All but one seat in that region went to the Conservatives. The anti-carbon tax message was popular here as was the sense the Trudeau government must take heed that if they rush to throw sand on the grave of the oil and gas business, they will be in a real national unity crisis.
Sticking with the Conservatives many of the party’s activists and supporters ended up quite deflated that they couldn’t snatch a victory from a vulnerable Justin Trudeau. In the post-election aftermath calls have been made for Andrew Scheer’s head and a major policy rethink on how the Conservatives deal with climate change. Former Conservative Environment Minister John Baird has been engaged to do an extensive post-election review.
Canadian minority governments usually last somewhere between 18 to 24 months. Buckle up for a wild ride!
Tim Powers, is the Vice-Chairman of Summa Strategies Canada and the managing partner of Abacus Data, both headquarters are in Ottawa. Mr. Powers appears regularly on CBC’s Power and Politics program as well as on VOCM in his home province of Newfoundland and Labrador.
Canada’s 43rd election concluded with a decisive result: the current Liberal government won a renewed mandate, albeit with a reduced seat count. With 157 of 338 seats, Justin Trudeau’s Liberals now hold a strong minority government. Meanwhile, the Conservative Party will remain as the Official Opposition, with a bolstered seat count of 121 and the bragging rights of winning the popular vote. As no Party has the political advantage or financial position to call an election in the near future, the Liberal minority appears secure and will be able to govern with confidence.
Despite a similar-looking House of Commons, stakeholders – particularly those in the oil and gas sector – should brace for changes, both nuanced and obvious, in working with government. While some risk exists, there is significant opportunity for the natural gas industry to work with the refreshed Liberal government.
“Liberals keep power with renewed climate mandate.”
– Jason Clark
The Liberals promised the most ambitious and achievable plan to address climate change, reduce emissions and grow the economy. And despite the Conservatives winning the most votes, a majority of Canadians voted for a Party promising to continue carbon pricing and take further climate action. Trudeau returns to Ottawa with a stronger mandate than ever to fight climate change and a Parliament willing to work with him to achieve more. Canadians were clear: they care about climate change.
Another stark observation of the election results was the regional divide: while Atlantic provinces, Ontario, and to some extent Québec were all kind to the Liberals, the governing Party failed to win a single seat in Alberta or Saskatchewan. In many cases, Conservatives won landslide victories across the West. Voters in these provinces were motivated over economic concerns; namely, the natural resources sector that powers the region’s economy. So while Trudeau works with allies on climate action in his next mandate, he must also be increasingly diligent to quell concerns and fears with natural resource stakeholders to heal the obvious division.
“Natural gas is particularly well poised to make in-roads with Ottawa.”
For that reason, natural gas is particularly well poised to make in-roads with Ottawa. A low-emissions intensity fuel, natural gas can displace higher intensity fuels – such as coal – in global markets, significantly cutting emissions while contributing to Canadian economic growth in the West. Further, the gas distribution industries commitment to cleantech and innovation – as evident by the creation of the Natural Gas Innovation Fund – and policy calls for support to advance rentable gases and natural gas vehicles are all important under a renewed banner and focus on climate change. Success will depend on the ability to tell this story to Canadians and government.
In the days following the election, the Prime Minister has committed to addressing the regional divide, taking first steps by consulting with the mayors of Calgary and Saskatoon and appointing Westerner Anne McLellan to his transition team. Engagement with the new Cabinet will be key, and industry should take the opportunity to point out alignment of objectives and engage with government on natural gas pipeline capacity issues to ensure product can move to international markets. With a compelling story marrying the economy and the environment, natural gas is well-positioned to win over Canadians and government to find success.
Jason Clark is a Senior Consultant with Crestview Strategies. He has worked in public policy development and advocacy and engagement campaigns – most recently for Engineers Without Borders Canada. Clark has also worked with a wide range of Canadian Non-profit organizations on international development and trade issues in Ottawa; and has previously managed one of the largest public engagement campaigns on climate change, energy and sustainability in Great Britain.
Canada’s 43rd general election was a quixotic one, ending with some winners substantially damaged, and losers in a stronger position than they started.
For New Democrats, while they lost seats, the 24 MPs they did elect represents a substantially better showing than the complete wipe-out many predicted. In the end, New Democrats avoided disaster, Jagmeet Singh was widely hailed for his strong campaign performance, with victories on all three Canadian coasts. And the NDP held off the predicted Green Party takeover.
And while Liberals won, they have a leader substantially less popular than before the campaign, and were shut out across the Prairies. In fact, only the NDP broke through the Prairie blue wave with a single Edmonton seat. Meanwhile, Conservatives improved on their 2015 result, but failed to take down a weakened Liberal Party and didn’t make any real inroads into Canada’s biggest cities.
“The new reality of Canada’s minority parliament.”
– Kathleen Monk
In minority governments, parties can leverage their control over Parliamentary Committees to generate media interest and set the agenda on a particular issue. And the opposition can now defeat motions in the House to shut down debate.
For New Democrats, their seat count is enough to pass legislation as they once again have the balance of power. An opportunity New Democrats haven’t seen since Jack Layton’s NDP navigated through seven years of Liberal and Conservative minority governments between 2004 and 2011. Now, the pressure is squarely on the NDP to show they can play a similar role in this parliament.
While some argue a minority Liberal government was the worst possible for the energy sector, this may not be the case. As Mr. Trudeau has ruled out any formal coalition, Liberals will be passing legislation on a case by case basis. They could make a deal with the NDP to pass their budget, and still pass legislation on pipelines with support from the Conservatives. Keep in mind that traditionally, the two parties that vote together the most isn’t the Liberals and NDP, it’s the Liberals and the Conservatives.
“Historically speaking, when parties are forced to work together good things can be accomplished.”
Remember when Stephen Harper was a newly elected prime minister with a minority government in 2006, he made deals with the Bloc to pass his first couple of budgets while working with the NDP to pass stronger ethics rules. Then, as the Harper minorities continued, Harper passed his next several budgets with help from the Liberals.
So, for those trying to influence government policy, a minority parliament certainly poses some new challenges — those doing government relations are certainly going to have longer call sheets — the situation provides some positive new opportunities, both in terms of promoting your issues through different political actors on the Hill, but also in terms of working to build a broader public consensus around your issue.
Historically speaking, when parties are forced to work together good things can be accomplished — including Medicare, public pensions, and a national affordable housing plan. Working together may not be what parties always do best, but its clearly the mandate Canadians gave all politicians on October 21.
Kathleen Monk is a Principal at Earnscliffe, where she is trusted by Canadian leaders to navigate complex public strategy issues, design strategy and bring together diverse stakeholders to tell authentic stories that deliver results. She appears regularly on CBC The National’s pre-eminent political panel, The Insiders, and provides analysis for CBC News Network’s Power and Politics.