• authored by about unions and remote viewer
  • published Tue, Jun 14, 2005

CUPE's Kostyra and Crocus's Commitment to Listen to Workers

A program for change requires a commitment to listen says Eugene Kostrya, Crocus's backroom puppet master.

Eugene Michael Kostyra was born June 19, 1947 in Winnipeg, Manitoba.

Kostyra dropped out of St. John's High School in Winnipeg, and did not return to academic pursuits in his adult life. He became involved in Manitoba's trade union movement and then entered political life, holding prominent positions in the one of Canada's largest unions.

Kostyra was active with the Canadian Union of Public Employees (commonly referred to as CUPE) for nearly three decades. He was a rank-and-file activist for the 7 years while he worked as a clerk typist and then as a substation electrician with the then publicly owned Winnipeg Hydro.

He then went to work for CUPE as an organiser in 1973, and over a 20 year period served as an organiser, union representative, negotiator, educator, assistant to CUPE National President and regional director. Kostyra served as the staff representative for CUPE Local 998 from 1977 to 1981.

As well Kostyra served in Howard Pawley's NDP Government as a member of the Legislature and Cabinet Minister during the period 1981 to 1988.

In the Manitoba provincial election of 1981, Kostyra was elected for the north-end Winnipeg riding of Seven Oaks. On November 30, 1981, he was named Minister of Consumer and Corporate Affairs. In years ahead, he would hold the portfolio of Minister of Culture, Heritage and Recreation and Minister of Urban Affairs, with responsibility for the Manitoba Housing and Renewal Corporation. He lost the last of these positions on February 12, 1982, although not before establishing the first rent controls in the Province of Manitoba.

On August 20, 1982, he was removed from the Consumer and Corporate Affairs portfolio and given responsibility for the Public Print Act and the Office of the Queen's Printer. On November 4, 1983, he was relieved of these latter responsibilities and the Urban Affairs portfolio, and named Minister of Industry, Trade and Technology, with responsibility for Manitoba Data Services and the Manitoba Development Corporation. On January 30, 1985, he was also given responsibility for the Manitoba Lotteries Foundation.

Kostyra was easily re-elected in the provincial election of 1986. Following a cabinet shuffle on April 17, 1986, he was promoted to the senior position of Finance Minister and Chairman of the Treasury Board, with responsibility for the Civil Service Act, the Civil Service Special Supplementary Benefit Act, and the Public Servants Insurance Act. He also retained responsibility for the Manitoba Development Corporation until February 4, 1987. On September 21, 1987, he was named Minister responsible for A.E. McKenzie Co. Ltd.

In early 1988, Kostyra introduced the NDP government's annual budget to the legislature, with the expectation that it would be passed by the narrow NDP majority in Parliament.

Instead, the government was defeated when disgruntled NDP backbencher Jim Walding voted against the budget, despite having promised Kostyra that he would support it.

Walding claimed that he was no longer willing to provide support to a ministry in which he had lost so much confidence. Walding later moved to British Columbia.

The NDP had lost considerable support in the two years since their 1986 re-election, primarily as a result of the increased automobile insurance rates in the province and significant revenue shortfalls in the province's publicly-owned telephone system.

The NDP entered the 1988 election with almost no hope of retaining government, and retained only twelve seats; Kostyra himself was defeated in Seven Oaks by Liberal Mark Minenko.

As Finance Minister, Kostyra increased personal taxes and presided over an expansion of Manitoba's provincial debt. He is not generally regarded as having been a successful Finance Minister, though his reputation for fiscal management may have improved had his government not been unexpectedly defeated in mid-term.

Kostyra remained active in the labour movement after his loss, serving as a Regional Director of CUPE Manitoba from 1989 - 2000 and retired from CUPE in September 2000.

A retirement roast was held for the retiring Regional Director of CUPE Manitoba. A dinner held in his honour on October 5 at the Winnipeg Convention Centre was attended by staff and friends, who had gathered to say thank you and farewell.

In the interim, Clive Derham, a city of Winnipeg employee and a CUPE local 500 member replaced Eugene Kostyra as acting Regional Director of CUPE Manitoba for a short period before he too retired from CUPE Manitoba.

Appointed in 1990, he was formerly employed with the City of Winnipeg. Until his retirement, Mr. Derham was employed as a Staff Representative with the Canadian Union of Public Employees, with primary emphasis being in the health care sector.

Clive Derham coincidently now works for the Manitoba Nurses Union (MNU) with his good friend Irene Giesbrecht, Director of Negotiations, MNU who was a member of the Crocus Fund Advisory Committee.

Bob Malazdrewich, took over the helm for a short period before retiring and handing over the throne to ex national representative Sandra Oakley. Malazdrewich worked for CUPE as a consultant after his retirement.

No one though who held the positon of CUPE Regional Director was so controversial as CUPE's high profile Eugene Kosytrya.

Kostyra was an active promoter of Credit Unions over large banks and held the position of president of Assiniboine Credit Union. He was also a founding member of CHO!CES, a Social Action Coalition in Manitoba that was located at 409 - 275 Broadway Avenue, in the Union Centre.

Kostyra was also a member of Crocus Investment Fund, the very fund that was investigated by the Manitoba Securities Commission and Manitoba's auditor general.

Bernie Bellan of the Crocus Investment Association, the association seeking to sue Crocus says: "Bring Eugene Kostyra out of the backroom once and for all and let him tell us how he's been the puppet master for Crocus, Workers Compensation and Assiniboine Credit Union, all at the same time."

In 2000, he was appointed by the NDP government of Gary Doer to head the province's powerful Community and Economic Development Committee (CEDC).

The CEDC was created by Premier Gary Doer, after he disbanded Gary Filmon's Economic Development Board. In this capacity, he has been responsible for recommending the passage of legislation favourable to union's interests albeit surely not the union members' interests.

According to a government paper, the Community Economic Development Committee provides analytical expertise and administrative support to the Community Economic Development Committee of Cabinet; coordinates all major government initiatives relating to community and economic development in the provinces; provides advice and support in the ongoing development of Manitoba's economic strategy including identifying priorities, soliciting community input and assisting in formulating policy and recommendations.

By an Order in Council, the NDP also approved a whopping 20 per cent raise in pay for Eugene Kostyra, the Secretary of the Community and Economic Development Committee of Cabinet, bringing his annual salary at the time to $107,124.

In October 2002 Kostyra wrote the article: Shaping A New Union - CUPE - in which he wrote: A program for change requires a commitment to listen.

In 2003, Kostyra supported Bill Blaikie for the leadership of the federal New Democratic Party, eventually won by Jack Layton.

In November 2004 Kostyra was given a position on the Red River Floodway Expansion Project by Gary Doer.

In March 2005 Premier Gary Doer and his Cabinet quietly appointed Kostyra as chair of the Red River Floodway Authority. The NDP floodway management agreement forces employers of non-unionized companies to hand over their names and addresses of their workers to Mr. Kostyra and the Floodway Authority.

The opposition is arguing that Kostyra will be able to hand over to unions the names, addresses and phone numbers of all the workers of the Red River Floodway Authority. They are afraid the information will be used by Kostyra and the unions to try to organize the heavy construction industry which has previously been mostly non-unionized.

The Wednesday, April 27, 2005 Manitoba legislative record raises further questions about integrity and principles in a world over run with secrecy and cronyism. We have excluded the Hon. Greg Selinger's responses to MLA. John Lowoen for a purpose.

Mr. John Loewen (Fort Whyte): Mr. Speaker, back to cosy relationships. We find out on November 27 that the Minister of Industry announced, and this is just days before we find out that trading has been halted in Crocus shares, and weeks and months after we have learned that the board at Crocus (Investment Fund) had been told they had serious problems and were in the midst of a crisis regarding their valuations, an announcement was made regarding CentreStone which includes about $5 million from government, government money from Workers Compensation, from MPIC, from TRAF, money from Crocus, all of whom have board members, have members on investment advisory committees. The crossovers are just too numerous even to mention in the brief time that I have.

The question to the Minister of Industry is how is it possible this announcement could have been made at this time without the NDP government having any discussion about the impending crisis at Crocus.

Mr. Loewen: Mr. Speaker, CentreStone is no ordinary fund. In fact, we find out that 23 of the 25 million came from government or government-related investments. As a matter of fact, I have an Order-in-Council dated April 30, 2003, signed by MaryAnn Mihychuk and Jean Friesen, the then-Deputy Minister, indicating that the government, through MIOP, had put aside $5 million into Magellan Venture partnerships through an Order-in-Council.

What that was to do nobody knows. All we know is that it sat quiet until another Order-in-Council was issued on June 16, 2004, signed by the Minister of Industry and Economic Development, the member from Brandon West, and was also signed by the Premier (Mr. Doer) of the Province of Manitoba, which somehow changes the name of Magellan industries to CentreStone Ventures.

It indicates once again that these discussions, these negotiations were done at the very highest level of government. They were kept secret and they were kept hidden. Again I would ask the minister to tell us how much did he know about the Crocus fiasco when this deal was announced on November 27.

Mr. Loewen: Mr. Speaker, this is an investment made behind closed doors, manipulated by the Premier (Mr. Doer), as we see from the Order-in-Council, manipulated by this government. As a matter of fact, the timing of this is completely unseemly. Just days before it was announced that the Crocus Fund had stopped halting in shares, this announcement of $23 million of government and government-related money going into a fund was negotiated behind closed doors quite likely by Mr. Eugene Kostyra.

I would ask the Finance Minister if he could explain why Mr. Kostyra would be conspiring to announce this deal just days before the crisis at Crocus was revealed to the public, just days before this House stopped sitting. How did Mr. Kostyra figure in this conspiracy?

Hon. Greg Selinger (Minister of Finance): Mr. Speaker, the member opposite alleges conspiracy. He has not demonstrated any evidence of that. He is, once again, prejudging the outcome of the Auditor General's investigation. I know the immunity of the House allows the member to slag the reputation of individuals, but I would ask the member to be at least a little bit careful about his leaps in logic. Let us see what the Auditor General comes up with. We will be ready to deal with it and correct the problem to ensure Manitobans are well protected.

Is there a difference between union leaders and government leaders or those who play dual roles? Should union leaders and government leaders be able to exchange roles any time it is convenient? How does this coziness affect workers and union members alike?

What part did Manitoba's unions and the NDP have in the demise of the Crocus Investment Fund? It is quite evident that Gary Doer's NDP are not friends of the Manitoba workers. Are unions? Is CUPE?

Are the NDP and unions like CUPE willing to begin to listen to workers or will it be the "status quo" forever: solidarity pitch?

A program for change requires a commitment to listen says NDP's Eugene Kostyra. Will the NDP listen to the workers and call an inquiry into all the players involved in the Crocus Investment Fund collapse?

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