In 1947, the Saskatchewan government established the Saskatchewan Transportation Company (STC), a state-owned crown corporation designed to provide province-wide bus and parcel service. According to Public Works Minister, John... [ view full abstract ]
In 1947, the Saskatchewan government established the Saskatchewan Transportation Company (STC), a state-owned crown corporation designed to provide province-wide bus and parcel service. According to Public Works Minister, John Taylor Douglas, STC was to “be a socially-owned enterprise … (that) provide(s) employment for Saskatchewan citizens and give(s) the province an efficient bus system operated not for financial profit, but for the good of the whole people.” Premier Tommy Douglas argued that rural residents should be afforded the same access as their urban counterparts. The regional bus system was an important development and networking tool connecting citizens, communities, agencies, organizations, and enterprises in ways that increased access, equity, and success. However, in its budget of March, 2017, the Saskatchewan government announced the rapid wind-down of the STC along with many other cuts to public services. Without systematic evaluation of alternatives, or of costs and consequences, the government simply announced that the public bus service was underutilized and too expensive and that the private sector would step up where there was sufficient demand. However, private interests showed little ability to replace the STC and the government was surprised by the depth of the protest and resistance to cuts in rural public transit and other services.
This paper reviews theory and evidence with respect to the economic and social roles of regional mass transit, as well as arguments for public or private provision. We also consider the decommissioning of the STC, and the degree to which in conforms or departs from other privatization initiatives. Premier Brad Wall invoked what he called “the World Bank’s definition of privatization” to justify ‘winding-down’ or selling-off 49 percent of any crown corporation without the need to call a referendum or election. Operating in the Global South and the economies of former socialist states, the World Bank has displayed a bias in favour of privatization. However, a review of World Bank publications reveals no clear-cut definition of a threshold for categorizing divestment of state-owned assets or enterprise as privatization. Furthermore, almost four decades of experience with privatization has made the Bank more cautious about promoting transitions from public to private ownership. They contend, for example, that the issues that can make public enterprises sub-optimum economic actors are the same factors that will interfere with successful privatization. Further, the Bank argues that privatization projects should take care to avoid ‘capture,’ as when privatization results in the benefits accruing to a small group and the costs being borne by wider society. The closing of the STC constitutes a privatization, one driven by free-market fundamentalism, a desperate search for cost savings and marketable assets, and an absence of political will to raise taxes on corporations. Nevertheless, the need persists for a reliable system of regional public transportation that facilitates networked development, economic diversification, environmental savings, public safety, and personal mobility. Without such a system, it becomes more challenging to make an attractive life and an adequate living in Saskatchewan’s rural (and urban) places.
