Flin Flon MLA Tom Lindsey believes the provincial government’s funding cut to an economic development loans program is detrimental to the diversification and growth of business and jobs in Northern Manitoba.
Manitoba’s Progressive Conservative government reduced funding to the Communities Economic Development Fund (CEDF) by $430,000 or 30 per cent during the 2018-2019 fiscal year. CEDF was created to provide loans to small and medium-sized businesses throughout the province for start-up or expansion needs.
During the 2016-2017 fiscal year, a total of $1.23 million in loans was distributed to enterprises developing in the northern portion of the province. These loans went to businesses located in Mafeking, Thompson, Winnipegosis, Moose Lake, Waywayseecappo, Swan River, Wabowden, Norway House, Churchill and Garden Hill.
The program contains money in two portfolios. As of March 31 of last year, the CEDF business loans dossier had $19.8 million, while the fisheries loans section contained $11.9 million for a total of $31.7 million.
Lindsey – the NDP’s critic for Labour, Crown Services and the Civil Service Commission – says decreasing the funding to CEDF is detrimental to the progress business and industry has made in Northern Manitoba. He said this is particularly true now, when industrial activities such as mining and rail transport are declining and economic diversification is fundamental for continued growth.
“Northern Manitoba is in a spot of trouble as far as opportunities go and this fund, once upon a time, provided start up loans for further development,” Lindsey said. “If we’re looking for something to replace some of the mining jobs that are going away, this program is a good way to get entrepreneurs in the north going.”
Lindsey suggested the PC government was setting its priorities on balancing the budget instead of doing what’s best for the province’s economy.
“This is about bettering their bottom line. It’s not about business effort and growth,” he said. “I think the sum of the amount that has been cut is not as important as the loans provided going forward. While they have cut this year, will they be cutting it again next year?”
Manitoba Growth, Enterprise and Trade Minister Blaine Pedersen says CEDF will continue to play a role in the development of the Look North Report and Action Plan, which is evolving through a task force established to develop strategies for economic development in Northern Manitoba.
“The province is working with CEDF to align its activities with broader economic development goals and maximize return on investment. As part of this effort, CEDF has been asked to find administrative savings,” Pedersen said.
“We are charting a new path to encourage growth and investment in Manitoba’s economy, recognizing that industry and the private sector are the true engines of economic growth and job creation. Under the leadership of (consultants) Dave Angus and Barb Gamey, the province is working to implement a bold new economic development strategy in partnership with business and industry leaders. Future directions for CEDF will be determined through this process.”
Meanwhile, Manitoba’s Growth, Enterprise and Trade department suggests there are other avenues Northern-based businesses can take in procuring benefits to help their operation financially. These include tax credits for manufacturing investment, research and development, and paid work experience.
There are also three equity tax credits available; the Community Enterprise Tax Credit, the Small Business Venture Capital Tax Credit, and the Employee Share Purchase Tax Credit.
Lindsey still believes the cuts to CEDF are out of alignment with any sort of commitment the government has made for northern development.
“The Pallister government is handing down these cuts without properly consulting residents in the north and they just don’t care about the damage these cuts will cause,” he said. “They need to listen to people in the north and they need to reverse course.”
