The NDP wants Ottawa to block the sale of a minority interest in Rogers' wireless backhaul network to a consortium of pension funds based on no information.

The Globe and Mail has a piece in today's Business Section by journalist Irene Galea describing how NDP leader Jagmeet Singh is calling on Liberal leader Mark Carney to block the sale of a minority interest in Rogers' wireless backhaul network to a consortium of pension funds, including Blackstone Inc., a U.S. based asset manager.

Mr. Singh is reported to believe that this sale is a threat to national security and contrary to the public interest although he does not explain why that is so. Unburdened and undeterred by facts or the lack of them, he nevertheless calls for the transaction to be blocked under the Investment Canada Act.

I fully understand that we are in an important election which is taking place during a period of global turmoil caused by an erratic ally and important trading partner, but isn't it in such times that we should focus on facts and the rational discussion of plans for moving forward? If readers agree that there is value in that approach, then I believe we can agree on the following:

• there is not a great deal of detail provided about the reported $7B dollar investment by a consortium of investment funds, including Blackstone Inc., in Rogers' wireless backhaul network so that Rogers can retire debt

• the investment is reported to be in return for a minority interest in a subsidiary entity formed to hold the backhaul network assets and that operating and voting control of that subsidiary will remain with Rogers at all times. This is likely to be a significant "transaction fact"

• One of the purposes of the Investment Canada Act is to provide an opportunity to review investments in Canada by non-Canadians that could be injurious to national security

• Other factors considered under the Investment Canada Act recognize the importance of encouraging investment, economic opportunity and employment opportunities for Canadians. All significant transactions are reviewed at one level or another under the Investment Canada Act and this most certainly would be one of interest

• Mr. Schwarzman, the co-founder of Blackstone Inc., apparently endorsed Donald Trump in his Presidential campaigns in 2020 and 2024. This is irrelevant to any ordinary course review under the Investment Canada Act and Mr. Singh knows this, so his comments are nothing more than a bit of partisan performance art

I believe it might be useful for people to understand how this will work behind the scenes. Currently, because we are in the middle of an election campaign, the normally opaque operations of the machinery of government are even more opaque. We are in a period governed by the caretaker convention. The caretaker convention requires that only the essential functions of governance are undertaken and that anything not meeting that "essentiality" test are deferred and/or dealt with quietly behind the scenes. In any event, this transaction undoubtedly meets that low threshold and will be reviewed albeit behind the scenes. In fact, I wouldn't be surprised at all if various information requests have been made to better understand the structure and implications of the transaction. In other words, a mountain of documents will be submitted and information requests will be answered.

There will, sooner than later, be other deals announced that monetize the intrinsic value stored in a variety of telecom asset classes. One thing people interested in telecom policy should ask is whether there are aspects of the posture governments have take to telecom policy contribute to this trend. It is an important bit of introspection that I doubt will occur but it should.

If political candidates of any party seek to campaign on issues related to telecommunications policy in Canada, I can recommend that they develop practical positions, for one, on closing the digital divide for rural and remote Canada which was the subject of yesterday's post. In particular, they could pledge, if elected, to constitute another funding round of the Universal Broadband Fund which contributes to the achievement of universal coverage objectives for broadband nationally. Where this is coincidentally consistent with Mr. Singh's politics, but on principled grounds, is that it would involve the cancellation of plans to use foreign low earth orbit satellite services like Starlink to serve the remainder of Canadians who would not qualify for fibre based service due to current funding constraints with the universal broadband fund. This would serve to meet Mr. Singh's apparent concern for national security, would provide further investment for extending the reach of Canadian owned and controlled networks and create shovel ready employment opportunities for Canadians.

The erratic behaviour of the U.S. has created uncertainty in the market which is never a good thing. The tariffs imposed are a tax on necessary inputs and will increase costs for telecommunications companies engaged in achieving the objectives of the universal broadband program. The Canadian election has also injected delay into the funding approval stream and the program will likely have to be extended beyond its current March 2027 end date. Those would be matters that Mr. Singh and the other party leaders could helpfully share their plans about, if in fact they are interested in advancing Canadian digital policy in place of partisan political shots.

Follow this space for some more observations on telecom policy items that party leaders could productively comment on that might actually interest and impact Canadians in a meaningful way.

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