Donald J. Savoie is the Canada Research Chair in Public Administration and Governance at the University of Moncton.
In the fall of 1986, former prime minister Brian Mulroney asked me to consult a cross-section of Atlantic Canadians and recommend how best to structure the government’s approach to regional development. I submitted my report, and two months later, the prime minister unveiled the Atlantic Canada Opportunities Agency (ACOA). The Mulroney model has met the test of time, lasting 33 years – nearly 20 years more than any previous federal regional development department or agency.
But shortly after ACOA was announced, Ottawa unveiled a similar agency for Western Canada, another for Northern Ontario, another one for Quebec. Under Stephen Harper, another agency was established for Southern Ontario, and then in Canada’s North. In its fiscal update last month, Justin Trudeau’s government announced plans to divide the Western Canada agency in order to create one for British Columbia. It was never made clear why British Columbia (42 seats in the House of Commons) requires its own regional development agency, and not, say, Alberta (34 seats), or better yet Newfoundland and Labrador (seven seats), given its distinct economic structure and current economic circumstances.
In that November fiscal update, Ottawa also announced new financing for all the agencies, including $508-million for Ontario and $170-million for the four Atlantic provinces. A few months earlier, the minister responsible for the regional agencies instructed officials to direct funds to “help the downtown cores of Canada’s biggest cities” and announced funding for Montreal, Toronto and Ottawa.
If this is what constitutes Canada’s regional development policy, one can legitimately ask: What does the policy not include? The approach may make sense politically for the federal government, but no matter how much you pile on, it can never amount to a real and effective regional policy, because an effective one cannot, by definition, mean anything and everything to everyone in every place. Yet right now, every postal code in Canada has access to a regional development agency.
The post-COVID-19 period will be a good moment to put Canada’s hidebound policies to the test, given Ottawa’s difficult fiscal situation and other developments. And in this opportunity for reset and reform, regional development policy needs to be high on the list – particularly for the rural communities that most need the support.
It only takes a moment’s reflection to appreciate that today’s economic circumstances are vastly different than those when the ACOA was first established. Halifax, Moncton and Charlottetown are vibrant cities when compared to 33 years ago, and they perform as well or better than other Canadian cities of comparable size. The three are now flush with job opportunities; what they need are people with the skills to fill them.
But this is not the case for rural Canada. We know that the economic impact of COVID-19 has been more strongly felt in rural communities than in the cities, but it is also far more difficult today for an entrepreneur to start a business in a rural setting than in an urban one. Access to capital, environmental regulations related to the exploitation of natural resources, the need to encourage Indigenous communities to become economic partners, and access to expertise and government decision-makers are among the factors that make that process more difficult. In contrast, an entrepreneur can start an IT business in downtown Halifax, Waterloo or Vancouver without spending much time dealing with governments and their regulatory demands. Aspiring entrepreneurs in rural Canada do not know how to deal with a complex set of federal and provincial government regulations – including a rising carbon tax, which will be more difficult to manage in rural communities – nor do they have the resources to retain lobbyists or high-priced legal counsel to represent their interests before government.
Ottawa should transform its ever-growing number of regional agencies into a ministry for rural development with a strong rural presence. This is not to suggest that Ottawa should simply throw money at rural Canada: If we have learned anything about regional development policy over the past 60 years, it is that throwing money at a region does not always help, and in some cases, it can even hurt. But such a ministry should put government policies to the test from a rural perspective.
The country’s political, economic and bureaucratic elites, its intelligentsia, and its major media outlets exist in urban areas, and they all have a hand in shaping public policy. The ministry would act as a counterforce to the built-in urban bias when shaping government policies. It would also send the message that Ottawa has a clear understanding of the economic challenges confronting rural Canada, and that its regional economic development policy has a clear focus.
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