With the release of the New Brunswick government’s quarterly fiscal update, there has been an increased focus on our economy of late. I would like to see this become the norm every day of the year. Our fiscal situation is our province’s greatest challenge our debt, continual deficits and lack of growth hangs over all aspects of public life. It restricts our ability to provide effective social services, education and infrastructure; it means we cannot make timely and substantial investments; and it means we aren’t creating the jobs that retain our youth and attract newcomers.
Some additional perspective is needed here. New Brunswick’s interest payments on our $13 billion debt are forecasted to reach $700 million in the current fiscal year. That means we are spending nearly $2 million per day for the interest payments on past purchases. This year’s projected deficit of $347 million for 2016-17 means we are also adding another $1 million or so to the debt every day. Every. Day. This is not new - the Province has effectively doubled its net debt since 2007, triggered by the 2008 financial crisis that New Brunswick has never recovered from.
So what’s the solution?
There are no easy answers - if there were, we’d already be doing those things. We are already overtaxed in New Brunswick - the government can’t reasonably expect to get even more revenue from taxing a shrinking population. There is only one other option - growth.
Enter the province’s Economic Growth Plan.
There is a lot to like in the Growth Plan. Modernizing government’s procurement process, a sector - level focus, business succession planning, regional cooperation, support for the proposed Energy East pipeline and the Sisson Mine to name a few. Metrics and targets are conspicuously absent, so regular and frequent updates on specific activities, successes and failures will be warranted.
“Community” and “community support” feature heavily in the plan. This can (and presumably does) mean a lot of things it’s one of the reasons our vision is Community Prosperity Through Business - community and business are not distinct pillars - they are fully integrated aspects of daily life. One thing it means is that citizens, organizations and communities have to do a better job of showing their support for projects and priorities. This plan wants to give voice to communities - let’s make sure we take advantage of that in Fredericton, because there are some red flags here as well.
The Growth Plan is centred on three core areas: natural resource development, energy and the knowledge industry. The Fredericton Chamber of Commerce fully supports these priorities We remain concerned, however, that it seems to be becoming increasingly difficult to get projects off the ground in the first two categories. Investors from around the world are looking at New Brunswick (if we can get them to look) and are seeing the Sisson Mine facing delay after delay, they see Enbridge run into after-the-fact regulatory changes, they see us turning down the hydraulic fracturing opportunity and they see us take an emerging sector in our economy - craft breweries - and regulating them into submission. It’s one thing to plan, it’s another to actually grow.
Expectations were high for the newly-released plan. It has been anticipated since the Liberal government took office and we were pleased to be consulted on its creation. While it appears to be a good overarching plan to bring focus to government’s economic activities - it is also not a silver bullet. It will be up to government to ensure that the plan is integrated throughout all departments, but it will be the success of the private sector that ultimately determines if the plan “worked”.
Krista Ross is CEO of the Fredericton Chamber of Commerce. With more than 950 members, the Fredericton Chamber of Commerce is one of Atlantic Canada’s largest chambers of commerce. A dynamic business organization, the Fredericton Chamber of Commerce is actively engaged in policy development that affects the competitiveness of our members and of the Canadian business environment. Its vision is Community Prosperity Through Business.