Untendered P.E.I. government phone contract worth $23M

The P.E.I. government will spend $23M for phone service with Bell Aliant over the course of 11 years according to the terms of a contract made fully public for the first time today.

The province entered into the untendered contract with Bell Aliant for its phone service starting in 2009. In return, Bell Aliant agreed to provide DSL internet service to 48 rural Island communities.

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Requests for government to make the contract public go back to at least Dec. 2, 2009, when former Opposition MLA Mike Currie asked former Innovation minister Allen Campbell to table the document in the Legislature. (Neither MLA has held a seat there since 2011.)

The full contract was released today by government after P.E.I.'s Information and Privacy Commissioner concluded making the document public would not harm Bell Aliant's business interests.

Contract extended twice

According to the contract, Bell Aliant offered a series of annual discounts off the amount the P.E.I. government spent on its phone service with the company in 2008: $2.8 M. For 2017, the province will pay an estimated $1.7 M.

The contract requires the province pay for a minimum of 2,501 phone lines. It's been extended twice, and will run until the end of 2019.

Under the second contract extension, agreed to in 2013, government gave up or postponed $1.4M in phone rate discounts previously agreed upon. Bell Aliant agreed to use that money to expand its fibre optic and DSL internet service.

Internet service no longer fast enough

But the current Economic Development and Tourism Minister Heath MacDonald said that DSL service, offering speeds of up to 1.5 megabits per second, doesn't meet today's data needs.

"No definitely not," MacDonald said. "With Netflix and stations like that, we really have to be moving forward. Five megabits per second would be the minimal we would want any household or business to have at the present time."

MacDonald pointed to a wide array of internet service providers currently operating on P.E.I., including Xplorenet. Last spring the federal government announced $1.6 M in funding for Xplorenet to provide broadband internet access to 12,000 Island households.

For its part, Bell Aliant provided a statement to CBC News, saying the company "exceeded our commitments under these contracts. We've provided significant value to P.E.I. residents with greatly expanded rural Internet capability and one of the highest levels of broadband fibre connectivity in all of Canada."

Some still without high-speed internet: Opposition

"It should have gone to tender to give everyone a fair shot at it," said Opposition MLA Matthew MacKay.

He also said government hasn't fulfilled the commitment it made when the deal was first announced under premier Robert Ghiz:to provide all Islanders with access to broadband internet.

"That was one of the reasons the $23 million took place, that was the deal," said MacKay. "And we've certainly seen Islanders that haven't received high-speed internet. This was a deal that was done in 2008 that was extended twice and [there are] still Islanders with no high-speed internet."

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