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Understanding Fiscal Policy Change for the Alberta Oil Sands

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Understanding Fiscal Policy Change for the Alberta Oil Sands University of Calgary PRISM: University of Calgary's Digital Repository Graduate Studies The Vault: Electronic Theses and Dissertations 2018-09-13 Policy Entrepreneurship: Understanding Fiscal Policy Change for the Alberta Oil Sands Weber, Jessica Dawn Marie Weber, J. D. M. (2018). Policy Entrepreneurship: Understanding Fiscal Policy Change for the Alberta Oil Sands (Unpublished master's thesis). University of Calgary, Calgary, AB. doi:10.11575/PRISM/32947 http://hdl.handle.net/1880/107784 master thesis University of Calgary graduate students retain copyright ownership and moral rights for their thesis. You may use this material in any way that is permitted by the Copyright Act or through licensing that has been assigned to the document. For uses that are not allowable under copyright legislation or licensing, you are required to seek permission. Downloaded from PRISM: https://prism.ucalgary.ca UNIVERSITY OF CALGARY Policy Entrepreneurship: Understanding Fiscal Policy Change for the Alberta Oil Sands by Jessica Dawn Marie Weber A THESIS SUBMITTED TO THE FACULTY OF GRADUATE STUDIES IN PARTIAL FULFILMENT OF THE REQUIREMENTS FOR THE DEGREE OF MASTER OF ARTS GRADUATE PROGRAM IN POLITICAL SCIENCE CALGARY, ALBERTA SEPTEMBER, 2018 © Jessica Dawn Marie Weber 2018 ii Abstract In 1995 and 1996 both the federal and provincial governments introduced major changes to their royalty and tax regimes for the Alberta oil sands industry. The stated goal of these reforms was to incentivize new investment. These changes came after decades of non- cooperation between the two levels of governments over oil sector policy and ignoring industry requests for fiscal reforms. Others have explained these changes as the result of a shift in priorities at high levels of government. However, there is no evidence that the policy change originated in government. Another explanation points to the creation of a new institution, the National Oil Sands Task Force. This is a partial explanation, but it does not ask explain how and why the Task Force was created. Using the policy entrepreneur model of policy change, this thesis provides an alternative explanation. Drawing on first-hand accounts from those who participated in the policy changes, interviews, and a contemporary newspaper analysis, this study concludes that a single person, Eric Newell, was a key factor—a successful policy entrepreneur—in achieving these reforms. The thesis documents how Newell determinedly created narratives, formed coalitions, and navigated multiple institutional venues to shape new fiscal policies for the oil sands industry. iii Acknowledgements Many debts make for many thanks. For financial help, thank you to both the Social Sciences and Humanities Research Council and University of Calgary’s department of political science. Thank you to the Petroleum Historical Society for the funding as well as the genuine encouragement and enthusiasm for my project. Thank you Eric Newell for generously sharing your time and stories. For a thesis focused on the importance of coalitions, I have thought much about the importance of relationships. I owe much to my friends and family who have been unwavering in their support. To my brother Dawson, thank you for insisting that I took regular breaks, and for always sending me home with delicious food. To my brother Casey, thanks for always calling to check in. To my parents, Florence and Lee, thank you for being excited for me, and always believing that I had this project well in hand. Thank you for your overblown confidence in my abilities, in this and in everything else. I consider myself extraordinary fortunate to have formed such deep friendships with my fellow graduate students. John, your passion and calm introspection has been a constant source of inspiration for me to be more bold and resolute. Connor, your commitment continually raising meaningful, tough questions ensured that 717 was truly the safest place for conversation. Andrew, your genuine curiosity about people and the world has been uplifting, your work ethic has inspired me to trust the process and put in the hours. To my friends, thank you for listening to me grapple with philosophical musings. To John Santos, Connor Molineaux, and Andrew Klain, your friendship has been a gift. Thank you for all of the stories, shared frustrations, late night ramblings, and for helping to knock off my rough edges. iv To my friends outside of university, thank you for both for your support, and for ensuring I spent enough time playing in the mountains. Thank you to those who proofread early drafts of these chapters: Cassandra Sampson, Michela d’Entremont and Morgan Hordal. To the professors who have challenged me to ask better questions, I owe a debt of gratitude. To Dr. Dennis Westergaard who first introduced me to political philosophy, thank you for expanding my world. To Dr. Cooper, thank you for all the conversations, the books, and the fun classes. Thank you for hiring me as your Teaching Assistant and Research Assistant. To all of the faculty and staff in the department, thank you for the challenging classes, and the encouragement. To my supervisors Dr. Ted Morton and Dr. Jack Lucas, thank you for your kindness and thoughtful assistance. You have both been very generous with your time and care. While I have learned much about researching and writing, I most appreciate the time you invested in me as a person. Thank you for all of the stories you shared over venison and in the office. v Table Of Contents ABSTRACT ........................................................................................................................................................ II ACKNOWLEDGEMENTS.................................................................................................................................... III TABLE OF CONTENTS ........................................................................................................................................V LIST OF TABLES AND FIGURES ......................................................................................................................... VII CHAPTER ONE: INTRODUCTION ........................................................................................................................ 1 OIL POLITICS LITERATURE ................................................................................................................................................. 5 FIRST MINISTERS’ CONFERENCES ....................................................................................................................................... 7 MAJOR PLAYER ANALYSIS .............................................................................................................................................. 10 OVERVIEW OF THE THESIS .............................................................................................................................................. 13 CHAPTER TWO: A HISTORY OF BITUMEN POLITICS........................................................................................... 16 INTRODUCTION ............................................................................................................................................................ 16 THE ALBERTA OIL SANDS: AN OVERVIEW ......................................................................................................................... 16 JURISDICTIONAL DIFFERENCES ......................................................................................................................................... 18 HISTORICAL TENSIONS ................................................................................................................................................... 20 Oil Crises and the National Energy Program ...................................................................................................... 22 Supreme Court Challenges and The Constitution Act, 1982 ............................................................................... 26 Election of Prime Minister Mulroney: A New Chapter? ...................................................................................... 27 1995/96 POLICY CHANGES ........................................................................................................................................... 30 CHAPTER THREE: LITERATURE REVIEW AND METHODS .................................................................................... 34 INTRODUCTION ............................................................................................................................................................ 34 EXPLANATIONS OF THE POLICY CHANGE ............................................................................................................................ 34 Election of Prime Minister Mulroney .................................................................................................................. 34 Alberta Chamber of Resources and the Task Force ............................................................................................ 36 WHY WE NEED A THEORY OF POLICY ENTREPRENEURSHIP.................................................................................................... 38 WHO CHANGES POLICY? ............................................................................................................................................... 39 A THEORY OF POLICY ENTREPRENEURSHIP .......................................................................................................................
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