The New Brunswick government denies that it broke the rules when it gave $50 million in loan guarantees to a Miramichi-based construction company, but it agrees that perhaps those rules should be reviewed.

Business New Brunswick Minister Victor Boudreau said Friday his department sought legal advice before giving the loan guarantees to Atcon Holdings Inc.

"In our opinion, we're not breaking the law," Boudreau said.

He agrees with the auditor general and the Opposition party, however, that the Economic Development Act prohibits funding for certain business activities such as quarries, something Atcon's president said his company would be doing.

Boudreau said that to specifically exclude the quarry work from financial help would mean dealing directly with subcontracting companies under the Atcon umbrella.

Should the investment not work out, he said, the parent company would have more assets available to protect taxpayers' money.

"So for us to get the proper security, to get the proper guarantees, we said we're going to do this deal with Atcon Holdings. To make sure we do have as secure a position as possible."

Boudreau said helping Atcon was something the government had to do, since the company employs 1,800 people with an annual payroll of more than $70 million.

However, given the complexity of business holdings today, perhaps it is time to review the province's Economic Development Act and its restrictions, Boudreau said.

"It certainly is worth considering taking a look at the act and seeing if we can modernize that act. [The year] 1982 is a long time ago, and a lot has gone on in the world since then."

Auditor General Mike Ferguson and Conservative finance critic Bruce Fitch said Thursday the loan guarantees are in violation of the province's Economic Development Act, and questioned the government's attitude in handing out taxpayer dollars to big business.