With the El Nino weather system holding out the promise of a warmer than usual winter for the province, leave it to Saskatchewan's crown corps to bring a chill of their own to the air. February frostbite has been replaced by November ratebite.

In the space of two weeks, a blizzard of rate increases has frozen the wallets of Saskatchewan taxpayers. First it was SaskEnergy announcing a 1998 rate increase of 9% for natural gas. Not to be outdone, Sasktel announced a 26%-47% two-year rate hike last week.

In both announcements, the crown corps site a changing regulatory environment, new market players, increasing competitive pressures and substantive capital outlays for technological improvements as driving factors which necessitate a "rebalancing" (that's crown corp speak for increasing) of rate structures.

Sasktel tried to bundle the rate increase as part and parcel of a package that embraces competition, expands local service in rural exchanges and cuts long-distance rates. They deserve a C-minus for effort. Unfortunately, their rate-hike response is predictable and self-defeating.

Sasktel proudly notes that it spends $100 million each year on investment and upgrading its infrastructure. With increasing competition, it will have to spend more than this figure to keep pace with accelerating technological changes. And the advent of new global players (witness the$37 billion WorldCom and MCI merger) will result in a proliferation of better services at lower costs. The best way to deal with these challenges is not to gouge your existing customer base, it is to find new sources of funds. Privatization through a wide-scale share offering is one of the best routes to follow.

The other zinger Sasktel tries to pass off on Saskatchewan taxpayers is that its rate changes will be revenue neutral. The last time we heard this one was eight years ago with something called the GST. The rate hikes are a tax, and taxes are never revenue neutral.

Sasktel's rate hikes are the wrong way to ensure corporate survival into the future. Privatizing Sasktel and allowing it to raise capital in the markets as opposed to taxpayer pockets is a better option. If the present course continues you can rest assured that Sasktel will be back again in a few years jacking rates as a result of competition, needed capital upgrades, blah, blah, blah. Yet each time it follows this route is akin to another nail in Sasktel's own coffin.

The larger problem is provincial government policy. In this era of accelerating deregulation and more efficient (read smaller) government, Saskatchewan is an anomaly in the Canadian federation. In the field of utilities, other provinces and the feds have turned their crown corps loose to fight for national and international market share. Both Alberta and Mantioba have already privatized their former telecommunications entities. Sadly, Saskatchewan has denied it's taxpayers the benefits of more profitable and competitive utilities by keeping them under government control.

The CTF - Saskatchewan has long advocated for a real review of the merits of crown corporations. In the field of telecommunications, divestiture of Sasktel through a sale or public share offering is the most appealing and pragmatic option. Sasktel is the only remaining crown-owned telecommunications company in Canada.

It's a shame that the NDP government doesn't free up an institution such as Sasktel to survive as a private entity in the 21st century. It looks as though it is in the winter of its corporate life - and the spring may never come.