The government of Ontario is receiving criticism for selling provincially owned telecommunications company Ontera. Why? The sale resulted in a loss of $61 million. Despite the controversy, Northern Development Minister Michael Gravelle says it was a “necessary decision” which will be positive for taxpayers.
Bell Aliant purchased the company in question for $6.3 million, whereas the Ontario government paid $6.5 million for the consultants, lawyers and others advising them on the sale alone. The loss, according to a Public Accounts report comes from a “disposal of shares of Ontera” because “the government provided a one-time contribution of $52,092,000 to support the sale” of the Crown corporation. Ontera provides local and long distance phone, data and Internet services to Northeastern Ontario.
“The decision to sell Ontera was made on the basis that there were costs involved in the short-term but in the long-term it made no sense from any point of view to maintain ownership of this telecommunications wing,” said Minister Gravelle. “It would have been far more costly in the long run to maintain it.”
Gravelle also promises Bell Aliant and the province are working together to improve access to fibre optics in Northeastern Ontario under Ontera’s jurisdiction. Together, the province and Bell have made a joint $15 million investment in this program.