Government's role in job creation debated
CBC News
Posted: Jul 23, 2012 2:44 PM AT
Last Updated: Jul 23, 2012 5:28 PM AT
Politics shouldn't play a part in job creation in the province, according to some politicians and people in the business community.
The creation of jobs in Saint John and Bathurst announced by the provincial government last week continues see people weigh-in on where taxpayers' money should go, and, what role government should have in job creation.
The provincial government announced its role in the creation of 30 jobs at a call centre in Saint John and 26 jobs in Bathurst to build defence vehicles.
Susan Holt, the president and chief executive officer of the New Brunswick Business Council, Liberal MLA Roger Melanson and NDP Leader Dominic Cardy spoke with the CBC's Information Morning Fredericton to continue the debate, which began with Kevin Lacey of the Canadian Taxpayers Association last Friday.
Kevin Lacey says the $1.6 million given through Invest NB to private companies would be better invested in health care, education or infrastructure. (Twitter)“Amazing, Premier [David] Alward hands out $1.8 million in corporate giveaways for just 56 jobs and opposition can’t be bothered to oppose it,” Kevin Lacey, the Atlantic director of the association, tweeted last week.
Holt said on Monday that she didn't like Lacey's use of the term "corporate giveaways."
"I think it's painting an over-simplified picture," Holt said.
"In these instances, it's not money being given away for nothing, there's an expectation in that the investment the province is making in these corporations is going to yield a return greater than the investment that they've made."
The taxpayers' federation official also said the amount of money for so few jobs concerned him. Lacey said the investment worked out to cost taxpayers about $30,000 per job created.
The province has lost 23 per cent of the money it has put into companies in the last six years — about $80 million, according to Lacey. And New Brunswick's record in funding private companies is “particularly lousy” because one in five businesses in New Brunswick goes under.
“When you consider the financial situation of the province, the question is really – can we afford it? I think the answer to that is, if we put our priorities in perspective, these corporate giveaways shouldn’t be part of our priorities,” Lacey said.
N.B. 'cannot sit on the sideline'
The Liberal party's economic development critic said he believes the provincial government needs to spend money on job creation as well.
"If we invest all of our focus and all of our money towards education, then we see our younger generation look elsewhere outside New Brunswick for jobs, then we lose ... so there needs to be an end-to-end strategy here from education to job creation and that's why at times government needs to spend some money for job investment," Melanson said.
However, Melanson said there needs to be a strong business case for those types of investments to ensure a strong return for taxpayers.
Melanson said it is possible to de-politicize the process, pointing to the Nova Scotia Business Corp., an arm's-length, non-political organization which he says is having a lot of success.
He also said the focus needs to be on companies in growing sectors to minimize risk for taxpayers and maximize companies' potential.
"New Brunswick cannot sit on the sideline," Melanson said.
Party opposition
Lacey told CBC News Friday the thing that seems to bind all New Brunswick politicians is “the support of spending money.”
The province's NDP leader said his party has been consistently opposed to government investment into "corporate welfare," because it hasn't generated the returns needed by the province.
"I don't want bureaucrats making decisions about business, same thing as the government running my corner store, I don't want them making decisions about what sector of the economy we need to invest in because I don't believe they have the competance and expertise," Cardy said.
Holt agreed and had an answer on how to ensure government investment goes to the company with the best chance of returning its investment.
"You get some smart people working in economic development, writing the policies and evaluating the business cases to say which is going to be the most profitable," Holt said.
She said there are good people working in the economic development department, and relationships need to continue to grow with the private sector.
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