Federal loan to Bombardier not enough, say critics
Montreal-based company was seeking $1B US in funding from Ottawa
Bombardier is getting a boost of $372.5 million from the federal government in the form of a loan, but critics — both in Quebec and in the rest of Canada — are calling it a "disappointment."
For many in Quebec, the sum is nowhere close to the $1 billion in federal funding the aerospace company had been seeking since the end of 2015.
"Bombardier is the major investor in research and development in Canada … and now, to see that after months of negotiations, the amount is just one third and it's a loan over four years, it's a bit disappointing," said Michel Nadeau, executive director of the Institute on Governance.
Too little, too late,- Rhéal Fortin, Bloc Québécois interim leader
Nadeau said the Quebec ministers on the file failed. Mélanie Joly, François-Philippe Champagne and Marc Garneau were at the Bombardier facility in Montreal Tuesday evening for the announcement.
"They failed to get a clear order from the cabinet of the prime minister to say, 'We are investing $1 billion in Bombardier, and we will recoup that investment and we will really make a strong commitment to the most powerful enterprise in Canada.'"
It's "too little, too late" for Rhéal Fortin, interim leader of the Bloc Québécois.
"The first talks started in spring 2015. We are talking about 20 months. Twenty months is enough for an elephant's gestation period, but we gave birth to a mouse," he said. "It's very far from $1 billion."
Last year, the company received a $1 billion US investment for the CSeries passenger jet program from the Quebec government in exchange for a 49.5 per cent stake.
Some were hoping the federal government would show the same support.
"It's necessary, [in order] to have a strong aerospace industry and maintain good jobs here, to have support from the government for these investments. It could be risky, but it could be profitable. As a loan, if the CSeries go well, taxpayers cannot benefit from that. That's too bad," said Alexandre Boulerice, the NDP's Quebec lieutenant and ethics critic.
'A step in the right direction'
Montreal Mayor Denis Coderre, who reacted to the announcement on Twitter late Tuesday, said the sum of the investment is not what matters.
"This contribution from Ottawa sends a strong message across the world. It's not the amount, but the fact of wanting to be associated with this project," his tweet read.
Cette contribution d'Ottawa envoie un message fort à travers le monde.Ce n'est pas uniquement montant mais le fait de s'associer à ce projet <a href="https://t.co/hL2y1MJRbQ">pic.twitter.com/hL2y1MJRbQ</a>—@DenisCoderre
Quebec Premier Philippe Couillard's office issued a statement late Tuesday, calling the loan "a step in the right direction."
"We expect the federal government to continue this collaboration with the goal to develop Quebec's aerospace industry," the statement read.
Ire in rest of Canada
Critics outside the province of Quebec also think the federal funding for Bombardier is a disappointment; they consider the funding too generous.
Aaron Wudrick, a spokesman for the Canadian Taxpayers Federation, says taxpayers should not be bailing out private companies.
"We're disappointed that they did but, if there's a silver lining, it's the fact that it's substantially less than [Bombardier] asked for."
Wudrick worries government loans will become the norm for struggling companies.
- Bombardier lowers delivery forecast for CSeries jets
- Bombardier hands out pink slips, as part of effort to cut 7,000 workers
- Bombardier to delay Global 7000 business jet after profit falls
"There are thousands of Canadians every day that lose their jobs, companies that go under.…If you add those together, they're the size of several Bombardiers. But no one thinks of bailing them out, and I think it's a problem when we start to treat large companies different than we would any other."
Meanwhile former ministers in the Harper government took to Twitter to call out Prime Minister Justin Trudeau for supporting Bombardier while phasing out the oilsands in western Canada.
Jason Kenney, the former immigration minister, tweeted:
So PM Trudeau wants to "phase out the oilsands" because C02, but gives $400M to subsidize C02-emitting aeroplanes: <a href="https://t.co/6FIILiAKNW">https://t.co/6FIILiAKNW</a>—@jkenney
James Moore, who served as the minister of industry, called Bombardier a "moral hazard."
I googled Bombardier and got this <a href="https://t.co/UmXFrHBnJQ">pic.twitter.com/UmXFrHBnJQ</a>—@JamesMoore_org
With files from CBC's Larry Guerriero