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A.
(Tower) Having worked for Mr. -- both Mr. Huskilson and Mr. Tedesco as
Vice-President of Customer Operations and being responsible for virtually half of the
costs at Nova Scotia Power, I'd like to give you a bit of flavour of budgeting and the
kind of culture that exists at Nova Scotia Power, and I think this follows on -- Mr.
Chairman, follows on a bit from your question to Mr. Blunden yesterday. So -- and
just by way of example, back in the fall of 2003 would have been a typical budget
round, as we would call it. We were under significant pressure to reduce costs. And
at that time, I would have been working directly for Mr. Huskilson. And I, like the
other Nova Scotia Power executive, would have been pushed pretty hard to come up
with cost savings as much as we possibly could. Mr. Tedesco was arriving in
January and we wanted to make sure that we had a budget that we felt was as
stretchy, is a word that we would use, as it could possibly be. And so we put
something together that we thought was challenging for us and would be challenging
for our teams. In January, 2004, Mr. Tedesco arrived and his -- the first thing that he
did was ask us to cut those OM&G costs even further. And while we had -- you
know, we had believed that we had cut as far as we possibly could, we had to look
for even more savings as a result of Mr. Tedesco's direction. And we did -- we did
look for those and we did get them. Things in my organization such as putting a
single power technician in a truck, for example, and putting a shift on and using the
truck for two shifts is something that we've done. Looking at automatic meter reading
to determine whether it makes sense. Looking at sole sourcing our vegetation
contract. I would tell you that pursuit of OM&G savings is not an event at Nova Scotia
Power. It is just something that we do all the time. And, in addition, certainly our last
general increase for staff overall would have been in January, '03. So we're asking
our staff -- we're asking our managers and our staff to do this at a time when we've
held their salaries fairly constant. So I just wanted to give that flavour because it is
something that we are -- and with the cost pressures that we face as a result of our
fuel increase, it is something that we've lived with and we've continued to look for
each and every day that we work there. And I would say we do balance that, though,
with customer service to make sure that we don't go any further than we need to and
ensure that we provide the customer service that we need. One of the things that
we've done is to understand very clearly our unit costs and understand our customer
service levels and understand when we take costs out what that does to service. And
so it is -- it does become a balance, but at the end of the day I would tell you and if
you'd ask many of the people that worked for me, cost saving is something that we
do. And I have continued that with me as I -- in my role as Chief Financial Officer, to
ensure we're in a -- you know, we're budgeting again this year. This is the time of
year that we do it. And certainly that philosophy would ring loud and clear.
A.
(Tedesco) I would just add to that that Mr. Merrick asked me, and I don't know if you
were in the room at the time, Mr. Grant, whether or not there were additional things
that we could do this year. And I think my answer was something to the effect that
this year in particular we have all the incentive we need to do whatever we can to
control costs. And it was my judgment that controlling costs further from where they
currently exist would cause deterioration in the service, and I still hold that judgment.
[Emphasis added]
(Transcript, December 1, 2005, pp. 3065-3069, emphasis in original)
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