With the Highway 407 owners $1 billion in hock to Ontario, surely this was an opening for Premier Ford to win something back for beleaguered commuters.
Looking for someone to wrestle the province’s nurses to the ground? Look no further — Doug Ford’s your man.
Despite the gruelling conditions nurses have faced during the pandemic, the premier has held them to a wage increase that’s well below the rate of inflation (even with their pandemic bonus).
But while a street-fighter with nurses, the premier turns to jelly when negotiating with the corporate world — as he showed in his crucial recent dealings with 407 International Inc., the corporation that operates Highway 407.
With the provincial election just days away, it’s stunning that Ford has managed to avoid the reputation of being a wimp when it comes to standing up on behalf of the province’s commuters. Ford’s key campaign promise is to build a new highway, the 413, to relieve traffic gridlock on Highway 401, one of the world’s busiest highways.
In fact, there is a much faster, simpler, cheaper — and less destructive — way to reduce 401 gridlock. But that would have required Ford to show some toughness in dealing with 407 International, which he was either unable or unwilling to do.
Indeed, the premier blew a rare opportunity to solve a problem that has bedevilled the province since former Conservative Premier Mike Harris privatized the 407, a highway built in the 1990s in an earlier attempt to relieve 401 congestion.
Harris struck an incredibly bad deal for Ontario commuters — imposing no limit on how high tolls could be raised — as long as the 407 maintained minimum traffic volumes, allowing it to qualify as a relief route.
These terms were locked into a preposterous 99-year contract, delivering spectacular profits year after year to 407 International — a mostly foreign consortium that in 2019 became 50.1 per cent-owned by a company controlled by the Canada Pension Plan Investment Board.
With explosive population growth in the GTA over the past two decades, the 407 turned into what one bank analyst called a “cash cow” and another described as “a value-generating monster.”
It became almost like a private road where those who could afford the exorbitant tolls enjoyed a largely empty throughway, while Ontario’s common folk remained crammed together on the 401.
Then, out of the blue, the pandemic created a unique opportunity for the province to get around the terrible deal Mike Harris had signed. With its traffic volume reduced due to the pandemic, 407 International faced stiff penalties — of about $1 billion a year.
The company could have avoided the penalties by simply reducing its tolls, thereby attracting more traffic. Instead, it approached the Ford government for relief from the penalties, on the grounds the pandemic was beyond its control.
Now, here was a fabulous opportunity for Ford to play hardball. For years, 407 International had relentlessly gouged commuters with its excessive tolls — among the world’s highest. With the company now $1 billion dollars in hock to the Ontario government, surely this was an opening for Ford to win something back for beleaguered commuters from this “value-generating monster.”
There were months of secret negotiations. In the end, the Ford government walked away, leaving that $1 billion on the table, as investigative reporter Paul Webster revealed in the Star last November.
Even more astounding, Webster noted, the Ford team apparently failed to use its billion-dollar leverage to press the 407 International to lower its tolls — which could have finally turned the highway into a true relief line.
Transportation Minister Caroline Mulroney meekly defended her government’s failure to press for lower tolls: “The 407 is a private company and they make their decisions.”
Despite fierce opposition from the other three provincial parties, Ford’s Conservatives insist the only way to solve 401 gridlock is by ramming a new highway through some of the province’s finest remaining farm and conservation land, at a cost of $10 billion, in a project that will take years to complete.
So relax and get used to many more years of being stuck on the 401, while the 407 remains a pleasing speedway for the privileged — but out of bounds for ordinary suburban commuters who, paradoxically, seem poised to re-elect Doug Ford.
Originally published in the Toronto Star May 30, 2022