OTTAWA�S STAKE IN OUR FUTURE
Regional Economic Development
Mr. Speaker, in partnership with the federal government, we have made significant investments over the past decade in regional economic development through various cost-shared cooperation agreements with ACOA. These have been particularly important in helping to rebuild and diversifying the economy of rural areas following the groundfish moratorium in 1992.
The federal government has taken a unilateral decision not to renew these agreements anywhere in Atlantic Canada or elsewhere in the country. This government states categorically that it does not agree with that federal decision. The upcoming year will mark the first time in three decades that the federal government has not partnered with the Province to assist in advancing our economy agenda. This issue was raised at every pre-budget consultation session this year.
We believe it would be in the best public interest of the Province for the federal and provincial governments to pool their collective resources in support of common economic development objectives and priorities, rather than have each order of government going their own way. For this reason we reiterate a call made in the recent Throne Speech for the federal government to partner with us in a new model of federal-provincial cooperation through a Canada-Newfoundland and Labrador Economic Development Board.
Recognizing that any such new model will take time to organize and implement, we again call upon the federal government to extend the Comprehensive Economic Development Agreement by one year through to March 31, 2004, with a $20 million allocation that would be cost-shared on a traditional 70-30 basis between the federal and provincial governments. We have already included in the budget a $5.5 million Provincial commitment.
If the federal government does not respond in a positive or timely manner to our proposal, these funds will have to be applied prudently to priority programs and activities within Provincial departments and agencies that were historically supported under cost-shared agreements with the federal government. This will include sustaining funding for initiatives important to our economic future like tourism marketing, the Newfoundland and Labrador Film Development Corporation, aquaculture and fisheries diversification programs, and various trade and export development activities.
This will consume most of the $5.5 million budget allocation, leaving little opportunity to consider the needs of the many external and community based economic development organizations from around the Province that were supported before under the Comprehensive Economic Development Agreement.
We intend to hold the federal government, and ACOA in particular, fully accountable for providing, from its own programs, the critical investments still required to build stronger regional economies throughout the Province, especially in rural areas. The federal government has the necessary financial flexibility to do this if it wants to, either from its $700 million Atlantic Investment Partnership Program or the huge budget surpluses available to it.
All-Party Symposium on Equalization
Equalization is another issue of crucial importance to the future of the Province. We propose convening a symposium of all Members of this Honourable House and all federal Members of the House of Commons and Senate in the Fall to examine Equalization prior to the five year renewal of the program, scheduled for April 2004.
Now that our offshore oil industry is poised to generate significant revenues it is more important than ever for mechanisms to be put in place to ensure the Province will be the principal fiscal beneficiary of this industry over the longer term. This is the most practical way for the Province to get access to the financial resources necessary to grow and diversify our economy so we can close the disparity gaps that persist between us and the rest of the country.
By retracting most of the fiscal benefits of our economic growth by lowering Equalization transfers, the federal government makes itself the principal beneficiary, overriding the commitment they gave to the people of the Province in the Atlantic Accord. Unless federal policy is changed, we will have a much greater task ahead of us in shaking off fiscal dependence on the rest of the country and taking our rightful place as a full partner in Confederation.
On a related issue, we have consistently made a case that federal transfers, like Equalization, which are largely per capita based, should not fall in lock step with population declines. Everyone recognizes that public services cannot be reconfigured as quickly as population changes. A mechanism should already be in place that phases in the impact of those changes. This has been supported by all provinces and territories. Population decline has cost us almost $900 million since 1993-94, including an estimated $140 million in 2003-04 alone. Our population decline is almost wholly attributable to the federal management of our groundfishery. Yet, the only federal action taken to mitigate its impact on transfers is inaction. These are among the important issues for the All-Party symposium to consider.
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