Bill C-309 (Historical)

Economic Development Agency of Canada for the Region of Northern Ontario Act

An Act establishing the Economic Development Agency of Canada for the Region of Northern Ontario

This enactment establishes the Economic Development Agency of Canada for the Region of Northern Ontario and specifies the powers, duties and functions of the responsible Minister and the Agency.

Economic Development Agency of Canada for the Region of Northern Ontario Act

[Anthony Rota, Liberal, Nipissing—Timiskaming, ON]

moved that Bill C-309, An Act establishing the Economic Development Agency of Canada for the Region of Northern Ontario, be read the second time and referred to a committee.

Mr. Speaker, I rise today to speak to Bill C-309. This proposed legislation looks to take the current federal economic development initiative for northern Ontario, otherwise known as FedNor, and convert it into an agency.

Before I go into the details why I believe FedNor ought to become a full-fledged government agency, I would like to discuss two main facts about the Canadian economy.

The economy of Canada is not one homogeneous entity. Different regions face different challenges. They have different growth rates, different strengths, and different weaknesses. Each region is unique and deserves special attention so that it can flourish and allow its residents to provide for their families and to live a decent and prosperous life.

Contrary to what the Conservative government believes, the federal government does not have an important role to play in promoting and encouraging the full potential of Canada's regions.

Having said this, there are a number of steps that can be taken by all levels of government to promote regional economic development.

First, there must be a fundamental recognition and understanding of the fact that different regions require different policies to develop their full economic potential. One size does not fit all when it comes to economic development. It is only by understanding that regions have different economic potential, that the essential building blocks can be put in place to ensure that full advantage can be taken of all available resources.

Second, the structure or, perhaps more important, the people who operate the structure have to understand the impact that they have on the economy, so that adjustments can be made on an ongoing basis to ensure that the economic realities of that region are being properly addressed. These changes are most effective when they are proposed by local people who are most directly affected by the impact of their recommendations.

So, having the structure in place is important. What is crucial, however, is that the people in charge understand what is happening in the regional economy. That being said, I would like to talk about the programs we have in place at this time.

Prior to the announcement made in budget 2009, the government had four regional economic development organizations. There were three agencies, which were the Atlantic Canada Opportunities Agency, better known as ACOA, Canada Economic Development for Quebec Regions, better known as DEQ, and Western Economic Diversification Canada.

Then after the 2009 budget SODA was added, Southern Ontario Development Agency, as well as the new regional economic development agency for the north. Now we have five different entities. One is a program and the rest are agencies. Why is northern Ontario different than all the rest?

Let us look at the difference between a program and an agency. The minister will tell us that words “program” and “agency” have no effect under Canadian law. He is right. Under Canadian law, there is no difference, but as far as Parliament goes, there is a difference. What separates FedNor from its counterparts is that each of the counterparts has an act of Parliament establishing it as a separate entity and outlining its mandate and powers, while FedNor does not.

The status of an agency in legislation means that the federal government requires the consent of Parliament to change or alter the agency's powers or its mandate.

In essence, a program can be changed, manipulated or even eliminated on a whim. We know the Prime Minister has often spoken of eliminating regional economic development programs and agencies. He does not believe in them. This is something that really worries me, losing everything we have because the Prime Minister decides he does not believe in them any more.

This bill would protect us from all governments, future and present. We know the present one does not believe in it, but future governments have to be protected as well.

The regions have their differences and those differences have to be respected. The Conservatives will claim that the free market system will take care of everything. We know that is not the case. We have just gone through the last six months, which have been outrageous, and it really has not worked for us. If we go with a free market system as the Conservatives would like, we would end up with some major centres in Canada, perhaps five large urban centres where the mass of the population would live and the regions would have nothing. There would be a vast waste land in between them. Everything would gravitate to where it is cheapest for large providers to provide services. That is not my Canada.

One of the other arguments that comes up is financial reporting. Currently FedNor's performance and financial reports are included as a chapter of Industry Canada's reports on plans and priorities and departmental performance reports. It is not a big chapter.

As a separate agency, under the Financial Administration Act, FedNor would be required to file detailed financial and performance reports for tabling in Parliament. The reports on plans and priorities would outline the agency's objectives, programs, spending plans and departmental performance reports, which evaluate whether the objectives have been met and provide the details of previous spending.

Let me elaborate on what that means in simpler terms. As an agency FedNor, would file estimates. Estimates give full details of what is planned for the coming year. From this, one can take a much closer look at the list of proposed funding and activities that are being planned and managed for the upcoming year, so they have a good vision of where the economic development is going in a certain region.

As a program on the other hand, the details become lost as part of the budget of Industry Canada. This means that as it stands now FedNor, as a program, really has no details. There is no breakdown of activities. There is nothing but a few numbers which imply that the program can be played with by the Prime Minister at his will or the minister himself.

Unlike an agency, reports for a program can only be seen at year end. To add insult to injury, it takes another six to eight months before those numbers come out, if we are lucky. After year end, we have to look at the detailed compilation of expenses, activities and reviews, but that is as much as 18 months after the beginning of the process.

It is like driving a car and concentrating on the rear view mirror. We cannot really look to the future. We are seeing what is behind us all the time. With regional economic development, we really have to look ahead and see where we will go, where we want to be and what kind of programs we want to have in place.

A prime example of what I am talking is this. Recently at the industry, science and technology committee, I asked the minister for detailed estimates for FedNor for the upcoming year. When I asked for those details, he said that he could give me something called “Northern Spirit”, which is a brochure. It is very colourful, it has beautiful pictures and it has all kinds of neat stories in it. I am sure some of the members on the other side were disappointed because the pictures were already coloured in. It was a really pretty brochure with no numbers, not one. It was basically a pamphlet that was handed out. We looked at it and put it aside.

What we are looking for is estimates, something that breaks down exactly what we can expect over the next year, and then plan for it.

Another problem is that the program does not have a minister to look after that and that alone. Under the Liberals, we had a minister of state for FedNor. Since the Conservative government has been in power, there has been no minister for FedNor. That portfolio now comes under Industry Canada, and that worries me.

Just this morning, I was speaking with a municipal councillor from northern Ontario. He said FedNor has received a number of applications, but they are still sitting on the minister's desk. They are sitting there and have not been approved. From what I have heard, nearly $8 million could be put into the economy. That money is not in the economy; it is sitting on the minister's desk. I understand that industry is a large portfolio and I am sure the minster must be very busy. However, we cannot forget the smaller regions. I know he is kept busy by the auto industry and many others, but northern industries like forestry are vital to northern Ontario. It is very important that these investments be approved so they can return to northern Ontario's economy.

Something I often think about is the fact that the people of northern Ontario are not second class citizens. We are Canadians like everyone else, like all voters. So, if a program exists, it should be given the same level of respect as an agency. That is the goal of my bill.

The Conservatives said previously that they did not intend to support Bill C-309 because it would lead to an increase in costs in bureaucracy. That is nonsense. Corporate services is one of the big areas at which they look. They say that every agency will need corporate services and that Industry Canada takes care of it for FedNor. That is not true. FedNor already has its own corporate services and communications division. If it were turned into a separate agency, creating these divisions would not be an issue. Some Conservatives will also argue against the conversion for FedNor.

We know, overall, Conservatives are not known for nation-building. They do not instinctively bring people together. They are use to wedging, getting groups apart and conquering, which is one way of doing things. I am not here to judge anybody and telling them whether it is right or wrong, but that is not the way the Liberals do it. The Conservatives do not look at the big picture. Everybody does their own thing. That is not the way to build a nation.

If the Conservatives had it their way, and we have heard the Prime Minister say it before, they would leave the economy to its own devices. In light of what we have seen over the last six months, that is not always possible and I do not think it works in the long-term. That may work in short spurts in the short-term and then we get booms, but the busts are what hurts. Government does play a role in what is done in the economy.

If we left the economy to its own devices, we would see a migration of people from regions to major centres. They would migrate to a few metropolitan areas and that would be it for Canada. Canada would be very sparsely populated in between because the concentration would be in the large cities, and we can understand that.

That is not my Canada. I do not believe most Canadians want that. They want to know they have the possibility of earning a living anywhere in Canada. This is not about being in just an urban centre. It is about being everywhere in Canada. My Canada includes northern regions and rural regions. My Canada includes all of Canada.

Since the Conservatives took office in 2006, the FedNor budget has been slashed by nearly $6 million. Bill C-309 is designed to ensure that FedNor would not be subjected to further cuts or elimination altogether.

Bill C-309 is designed to promote economic development, economic diversification and job creation in communities throughout northern Ontario. A FedNor agency would demand greater accountability and would be required to report to Parliament on a regular basis.

My Liberal colleagues and I are committed to ensuring that the residents of northern Ontario are given every opportunity to develop and maintain a strong regional economy, as well as diversify strength in their employment base. Residents of northern Ontario expect and deserve the same opportunities, the same access and accountability and the same quality of service as their fellow Canadians in all other parts of the country.

Bill C-309 has received widespread support from municipalities throughout northern Ontario, including the Federation of Northern Ontario Municipalities. I trust my hon. colleagues from the three parties in the House will also support the bill based on its merits.

[Claude Gravelle, NDP, Nickel Belt, ON]

Mr. Speaker, I have heard over the years innuendoes that FedNor money is being channelled to southern Ontario. Could the member enlighten me as to whether this is true? If it is true, does he know how much FedNor money is being spent in southern Ontario?

[Anthony Rota, Liberal, Nipissing—Timiskaming, ON]

Mr. Speaker, that is a rumour that has been around for quite some time. There has been a rumour about money being funnelled into southern Ontario from FedNor. It is not quite true. This has been going on for a number of years.

There is the community futures program that allows for economic development on a smaller scale and allows small operators to get money. It is a loan program. That money is administered by FedNor out of Sudbury for all of Ontario. That is very important because it is not FedNor money but it is being administered from Sudbury in northern Ontario. Those are federal jobs being put into Sudbury and not centralized in Ottawa. They could have been anywhere in the world.

That is a case for regional economic development in northern Ontario. Business can be conducted from anywhere in the world with today's electronics and programs. With everything that is out there, one can have pretty well anything one wants in northern Ontario. This is a prime example of how federal services put in place by the Liberal Party are creating jobs in Sudbury for the rest of Ontario.

[Shelly Glover, Conservative, Parliamentary Secretary for Official Languages]

Mr. Speaker, I am pleased to stand in the House today to discuss northern Ontario and specifically the role of FedNor, the regional economic development organization for northern Ontario.

As the Minister of Industry told the members of the Standing Committee on Industry, Science and Technology, our strategy is ”if it ain't broke, don't fix it”.

Our government continues to build a healthy future for northern Ontario and for most economic growth through the delivery of FedNor's northern Ontario development program and the community futures program. It is no secret that FedNor receives broad-based and universal support from mayors, community leaders and other stakeholders in northern Ontario. The reason is simple: it works.

I will now talk about the fine work that FedNor does in northern Ontario through the northern Ontario development program, or NODP.

By hearing more about FedNor's role in northern Ontario, I hope all members will garner a better understanding of how much this organization impacts on the lives of northerners. FedNor does much more than simply fund individual projects in the many communities it serves.

When community partners, leaders and stakeholders identify opportunities for development in northern Ontario, they come to FedNor with these ideas and their proposals. FedNor staff is closely connected to the communities they serve and they know the challenges and needs of those communities.

FedNor works with project proponents to ensure how best to meet their needs. It considers the benefits of specific projects on a local, regional and pan-northern scale, working with partners to maximize the impact of FedNor projects. In short, FedNor takes a truly holistic approach to economic development, funding projects that will collectively strengthen the whole of northern Ontario.

To accomplish this, FedNor focuses on specific sectors or areas of northern Ontario's economy, keeping in mind that each project builds the capacity that is needed to undertake other worthwhile initiatives.

At the same time, FedNor delivers the Government of Canada's agenda in northern Ontario, such as our economic action plan. New initiatives, such as the community adjustment fund, will help us keep the economy of northern Ontario moving.

Canada's economic action plan will have a direct and positive impact on the economy of northern Ontario and FedNor will continue to work closely with northern Ontario communities and industry leaders to ensure that our efforts meet their specific needs.

FedNor supports northern Ontario projects that complement our government's strategy to promote a competitive, knowledge-based nation. In 2007-08, the northern Ontario development program's annual grants and contributions' budget totalled more than $36 million.

I will now illustrate how FedNor is using this budget successfully to grow the northern Ontario economy. First, I will give some background. The northern Ontario development program covers a large geographic area. Northern Ontario represents about 90% of the province's land mass. It stretches from Muskoka to James Bay and from the border of my province of Manitoba to the border of Quebec. This great part of Canada is also home to more than 850,000 people.

The vastness of northern Ontario, given its relatively low population, helps explain some of the challenges, including: geographic isolation from large, urban markets to the south; limited telecommunications and transportation infrastructure; static or declining population; high youth out-migration rates; and a lower than average employment growth. FedNor's northern Ontario development program is working to address these issues and much more.

Specifically, the northern Ontario development program promotes economic growth in northern Ontario through the delivery of contributions funding. Funding is directed primarily to not for profit organizations for projects not eligible for commercial financing and projects that are key to the development of capacity in the north. Program contributions are available to support projects in six areas: community economic development, innovation, information and communications technology, human capital, business financing support, and trade and tourism. FedNor is making a real difference in each of these areas.

In the area of community economic development, FedNor focuses its efforts on strategic planning to enhance business competitiveness and job creation. To help communities deal with the challenges of sudden or severe downturns affecting the local economy, FedNor supports diversification strategies. Never have these types of strategies been more important than they are today during these difficult economic times.

One excellent example is the northern Ontario value-added initiative, or NOVA. This three year initiative is introducing communities affected by the downturn in the forestry sector to new forestry related economic renewal opportunities. NOVA representatives have undertaken a tour of about 200 mills and secondary forestry related operations to introduce this program.

In essence, the project is supporting the development of value-added products and improvements to manufacturing processes as well as providing market access information. In addition to its diversification initiatives, FedNor also promotes regional initiatives that build strong, sustainable communities. One such initiative is the Northern Centre for Advanced Technology, or NORCAT. The Northern Centre for Advanced Technology is one of a cluster of premiere research and development organizations in northern Ontario that our government has supported through FedNor.

With FedNor's help, NORCAT has grown to become a leader in the development and commercialization of new mining technologies. In fact, in April 2008, this government invested $2 million of FedNor funding into NORCAT to construct a state of the art building to house a new incubator facility and centralize NORCAT'S technology development and industrial services. This NORCAT centre will provide the private sector with one-stop access to NORCAT's industrial training and innovation services. It will also bring to the region a new service for small businesses and pre-commercial entrepreneurs.

Once complete, the centre will accommodate up to 22 small and medium size enterprises by providing flexible rental space, access to labs and workshops, as well as business and technology support services. The positive impact of this investment in NORCAT will be felt in northern Ontario for decades to come. It is but one example of the great work FedNor has been able to accomplish under a Conservative government.

Projects like this are building the capacity that northern Ontario needs to diversify its economy. That is community economic development.

To keep moving forward, we must ensure that we have the human capital to support our efforts to build a strong northern Ontario. In that light, FedNor supports other important initiatives that provide northerners with the opportunity to remain in and contribute to their respective communities.

One concrete example is FedNor's successful youth internship program. In the summer of 2006, FedNor celebrated the placement of the program's 1,000th youth intern. Since 2002, FedNor has invested over $35.7 million in youth related projects across northern Ontario. Designed to help post-secondary graduates make the transition from the campus to the workplace, this program provides interns with hands-on experience and an opportunity to find full-time employment in the north. It also helps to stem the tide of youth leaving northern Ontario, which has long been a serious issue in northern Ontario.

We know that only 25% of young people who leave northern Ontario for education or employment opportunities ever return. FedNor is serious about providing opportunities for its best and brightest to ensure they remain and contribute to the future of northern Ontario. As an added benefit, the internship program also provides employment assistance for small businesses and not for profit organizations that are looking to grow.

It is important for the communities and businesses of northern Ontario that FedNor remains flexible and responsive as an organization to benefit the people it serves. As members will hear from my colleagues, FedNor's other areas of focus are also bearing fruit across all of northern Ontario.

[Jean-Yves Roy, Bloc, Haute-Gaspésie—La Mitis—Matane—Matapédia, QC]

Mr. Speaker, I would like to begin by saying that the Bloc Québécois will support Bill C-309, An Act establishing the Economic Development Agency of Canada for the Region of Northern Ontario, which was introduced by my colleague from Nipissing—Timiskaming. It is not that we support federal government interference in regional development, but if the people of northern Ontario and the Government of Ontario want to create an agency, the Bloc Québécois would obviously be ill advised to oppose it.

The purpose of Bill C-309 is to establish the Economic Development Agency of Canada for the Region of Northern Ontario, which, like the Economic Development Agency of Canada for the Regions of Quebec, would be responsible for promoting the development of northern Ontario in accordance with an integrated federal strategy.

The Bloc Québécois defends Quebec's interests, and that is why in the past we voted against Bill C-9, which created the Economic Development Agency of Canada for the Regions of Quebec. Members will say that we are being inconsistent. We voted against creating an agency in Quebec, yet we support creating an agency in Ontario. I have no problem with that, because if the people in northern Ontario want to create such an agency, then naturally we will support them.

The Bloc Québécois believes, as all the governments of Quebec have believed for more than 45 years, that in order to be able to develop an integrated policy on regional development, Quebec must have control over regional development programs. I will explain this further during my speech.

As my colleague has just said, the regions are the ones with the solutions. Quebec in particular has organizations that focus on the socio-economic development of their regions. These organizations are in a position to properly advise the minister on regional needs and to help with program implementation. The local development centres were created specifically to develop the regional economy and to advise ministers in order to ensure that the investments made would be as cost effective as possible for regional development. Over the years, we have also created another kind of organization, the regional conferences of elected officials, which bring together all mayors and other elected officials in each of the regions. Obviously, they examine every file relating to regional development and they, too, are well placed to provide the minister responsible with proper advice.

The Bloc Québécois is aware that not all governments have the same priorities. Despite the fact that the agency is joyfully trampling on Quebec's toes in its jurisdiction, if the Government of Ontario has decided to welcome this structure into its regional economy, we cannot do otherwise than agree, as I said. It must be pointed out as well that Ontario has been hit very hard by the economic crisis, northern Ontario even more so because of the forestry crisis and the decline of the auto industry.

I would like to make the point that a true regional development strategy needs to include a broad range of components: natural resources, education, training, municipal affairs, land use, infrastructure and so on, none of which are in any way federal responsibilities. In fact, the Canadian Constitution entrusts most things that concern regional development to Quebec and the provinces.

In order to be in a position to create an integrated regional development policy, all of the governments of Quebec in the past 45-plus years have been demanding control of the regional development program.

Between 1973 and 1994, an agreement was in place between the Government of Quebec and the government in Ottawa. According to it, Ottawa could not invest in regional development without the agreement of the Government of Quebec. In 1994, that agreement was broken. Since that time, there have been two parallel structures in Quebec, those of the Government of Quebec and those of the federal government, which both invest in regional development.

Very often the two are in conflict with each other, because the Economic Development Agency of Canada for the Regions of Quebec sets priorities for itself that are not shared by Quebec or the regions of Quebec. This clash of regional development systems is a very common occurrence.

Another phenomenon has also cropped up since the Conservatives have been in power.

As my colleague mentioned, the government made deep cuts to the Economic Development Agency of Canada for the Regions of Quebec's budget. Those cuts were significant.

Since 1994, the agency has been investing in research and development organizations responsible for supporting businesses. I could list all kinds of organizations in every region of Quebec that were responsible for helping small and medium-sized businesses conduct research and development and bring their ideas to market.

Small and medium-sized businesses do not necessarily have the financial means to do research and create and launch new products. That is why the agency invested in those kinds of organizations. Then, suddenly, two years ago in 2007, the agency withdrew its support. That is the problem with having two parallel regional development systems. The Canadian agency withdrew, and now a lot of those organizations are in trouble. Basically, the entire structure that the Government of Quebec and the regions of Quebec built over the years has been demolished.

I can provide actual examples of that in my region. Among other things, the forest research centre, which was supported by the Canadian agency, was unexpectedly told that it would have to begin turning a profit within about two years. That was utterly impossible. That kind of development will no longer be happening. The federal government must understand that regional development cannot happen without taking into account each region's priorities and those of the Government of Quebec.

Earlier, my colleague from Abitibi—Témiscamingue was talking about the Minister of Industry. I should point out that the Minister of Industry was responsible for the agency, and he is the one who cut funding to several organizations in Quebec. The new minister tried to restore funding, but I do not think that he tried hard enough, because instead of restoring the funding, organizations were simply given an extra year within which to become profitable. It is no secret that most research and development organizations will never be profitable because they do research and development to bring products to market. It takes years and years to turn a profit, and that is not what these organizations are meant to do. Their role is to support businesses, not replace them. That is where the government made its mistake.

Earlier, my colleague said that the Minister of Industry was very busy because there are files piled up on his desk. I would say to him that is probably the same tactic he used at the Economic Development Agency of Canada because everything ended up on his desk. Files would languish and he was accused—I believe rightly—of engaging in petty politics, cheap politics, by using the funds of the Economic Development Agency of Canada. In my opinion, the same thing is currently happening at Industry Canada. It is the same minister.

Let us be serious. He probably used the same tactics and is probably continuing to use the same approach. That means files were not dealt with, files are languishing and will continue to do so because he has to look at all of them, one by one, and he does not trust anyone, especially not the directors of agencies in Quebec and probably not Industry department officials.

I am being told that I have one minute left. Therefore I will repeat that the Bloc Québécois will support the creation of a development agency for northern Ontario because that is the decision of the people who live there and of the Ontario government, and that is important to us. Therefore, if those people want it, as a political party that respects all regions, I believe that we must vote for Bill C-309.

[Claude Gravelle, NDP, Nickel Belt, ON]

Mr. Speaker, I would like to thank my colleague, the member for Nipissing—Timiskaming, for introducing Bill C-309, An Act establishing the Economic Development Agency of Canada for the Region of Northern Ontario.

I would like to thank the member for Saint Boniface for speaking for northern Ontario.

I would also like to recognize and commend the NDP member for Sault Ste. Marie for all his hard work on the development of this legislation in the past Parliament. The member for Sault Ste. Marie has been a tireless advocate for northern Ontario over the years, especially with regard to FedNor.

I would also like to congratulate the hon. member for Sault Ste. Marie on all his hard work on this legislative measure during the last parliamentary session. Our hon. colleague has for some years been a staunch advocate for northern Ontario, especially in connection with FedNor.

When I was elected several months ago, I had the great privilege of having the FedNor file assigned to me within the NDP caucus.

When I was elected several months ago, I felt very privileged to be assigned the FedNor file within the NDP caucus. Throughout northern Ontario, people have been experiencing an epidemic rate of job losses over the past few years, and even more so within the past few months. Both of our main sectors, forestry and mining, have been hit hard during this recession. We have seen job losses at Xstrata, Vale Inco, AbitibiBowater, John Deere, CBC, Persona, and the list goes on and on. It is crucial for northern Ontario that we have a fully independent and appropriately resourced economic development agency.

FedNor must be able to adapt to the changing economy and ensure the economic prosperity of the workers of northern Ontario and their families. Its mandate must be drawn up at the local level by the people who live in the region, not by some faceless bureaucrat in the Ottawa offices of Industry Canada.

It is time they stopped treating the people of northern Ontario like second-class citizens. Everywhere in this country there are economic development agencies with what it takes to really encourage the local economy. There is no excuse not to have one for northern Ontario, where we face so many economic challenges.

We need a FedNor that can adapt to our changing economy and ensure economic prosperity for northern Ontario workers and their families. FedNor's mandate needs to be developed locally by the people of northern Ontario, not by some bureaucrat buried within Industry Canada stationed in Ottawa.

It is time to stop treating northern Ontarians like second-class citizens. There are economic development agencies throughout the country that have the capacity to make a real difference in the local economy. There is no excuse not to create one for northern Ontario, where we face so many economic challenges. During this recession, our economy needs to diversify and grow. Now is the time to encourage small business start-ups and expansions, and community economic development.

Because FedNor is underfunded, many worthy projects are turned down. The Centre for Excellence in Mining Innovation would make northern Ontario a world leader in mining resources and development. CEMI is currently researching exploration, deep mining, integrated mine process engineering, and environmental sustainability, all areas that would greatly enhance the competitiveness of the mining sector not only in northern Ontario but throughout the country.

CEMI has received funding from the Government of Ontario, Vale Inco, Xstrata, Laurentian University, the Greater City of Sudbury, and the Ontario Mineral Industry Cluster. The private sector, provincial and municipal governments have all come to the table to support the centre. Yet, FedNor has declined CEMI's application because it does not have enough funding to meet the request. This is a slap in the face for northern Ontario.

With our mining sector suffering as it is, now is the time for the federal government to pull its weight and invest in research and innovation, so that we can be ready when the economy rebounds.

The long-term care facility at Chelmsford, St. Joseph's Health Centre, is another FedNor reject. This facility will make 128 beds available and employ 160 full- and part-time workers. Once again, the provincial and municipal governments and the community were on board with this project, but FedNor rejected its application because it did not fit into the narrow FedNor mandate.

There is a bed shortage for patients requiring a higher level of care in Sudbury and Nickel Belt, and this institution will be a great help in alleviating that problem.

As well, the area needs good permanent jobs. Nevertheless the FedNor mandate is not flexible enough to meet some of our communities' most crying needs.

A second project that was also turned down by FedNor is the St. Joseph's long-term care facility in Chelmsford. This facility will create 128 long-term care beds and employ 160 full-time and part-time workers. Again, the provincial and municipal governments, as well as the community, have come to the table to support this facility. St. Joseph's application was turned down by FedNor because it does not meet the narrow mandate.

There is an alternative care bed shortage in Sudbury and Nickel Belt. This facility would go a long way in alleviating this crisis. There is also a need for good jobs and permanent employment. Despite this, FedNor's mandate is not flexible enough to meet some of our community's most pressing needs.

Meanwhile, projects throughout southern Ontario are receiving funding through programs administered by FedNor, while the people of northern Ontario are being left behind. Northern Ontario is a socially, geologically, ecologically and economically distinct region situated on the boreal forest of the Canadian Shield. It is home to 102 of the 134 first nations in Ontario, 43% of Ontario's aboriginal population and 27% of Ontario's francophone population. It is a treasure house of natural resources, lands and waters, provincial parks, fisheries and natural wilderness areas. If it were a province, only British Columbia and Quebec would be larger.

Northern Ontario clearly faces unique challenges, but also great opportunities. Our region deserves its own regional economic development agency.

I am urging all members of this House to support this bill through its second reading. The people of northern Ontario have been ignored by the government for far too long. With the passage of this legislation, FedNor would be able to take its rightful place as an independent, fully funded economic development agency. I think it is broke, so let us fix it.

[Dominic LeBlanc, Liberal, Beauséjour, NB]

Mr. Speaker, I am very pleased to speak to Bill C-309, in the name of my distinguished colleague from Nipissing—Timiskaming.

My colleague, the member for Nipissing—Timiskaming, is the chair of our national caucus. He is a very powerful and consistent voice for regional development in northern Ontario. He is somebody who speaks often in our caucus and in numerous meetings I have attended about the importance of investing in the regions of the country, about the importance of understanding that the regional economy of the area he represents in northern Ontario is different from some of the challenges or some of the economies, for example, in southern Ontario, which is also suffering in this very difficult Conservative recession.

Our colleague, when he introduced the bill, made a very compelling case why FedNor should in fact have its separate legal status and a statute creating an agency of the Government of Canada and not simply a program buried at the Department of Industry.

I come from Atlantic Canada. The Atlantic Canada Opportunities Agency, ACOA, as my colleague from northern Ontario noted, has a separate statute. It is created by an act of Parliament with a mandate. It is set up under federal law to operate as an agency of the Government of Canada. It is not subject to an administrative committee or a bureaucratic decision at some third level buried at the Department of Industry.

I do not know why economic development in northern Ontario would take a second-class position to the importance of investing in regional development in Atlantic Canada, in western Canada, with the economic diversification initiative, or in the Quebec regions with Développement economique Canada pour les régions du Québec.

As my colleague pointed out earlier, the Economic Development Agency of Canada for the Regions of Quebec operates at arm's length from the government.

I think it would be a good idea to have a minister in Parliament who can appear before parliamentary committees, a minister responsible for credits and for protecting the interests of northern Ontario.

We are left to ask ourselves why the Conservative government is going to oppose the bill. Why are the Conservatives going to resist putting regional development in northern Ontario on the same footing as it is in other regions of the country? Why did they create an agency for economic development in southern Ontario? As I said a minute ago, that region is suffering serious economic distress as a result of the global economic recession and the inability of the Conservative government to face head on the economic challenges facing every region of the country.

Is there an agenda in the Conservative government to abandon northern Ontario? Are the Conservatives leaving it as a program at the Department of Industry instead of a separate agency of the government created by statute? Did someone at some meeting on a Monday morning or a Friday afternoon at the Department of Industry on Queen Street here in Ottawa decide that another program in the department was short of money so they would get a bit from FedNor?

It is horribly unfair to leave the economic future of the communities represented by my colleague from Nipissing—Timiskaming and other members of the House from northern Ontario so vulnerable in the face of competing budget priorities and in the face of what I believe is a complete disinterest on the part of the Conservative government in regional development.

As I said a moment ago, I represent a riding in rural New Brunswick where regional development is essential not only for the economic future of the community, but also for municipalities to have access to an infrastructure program that meets the unique needs of smaller municipalities and some remote and regional communities.

One of the more compelling arguments for economic development that I have ever heard, and for the idea that the Government of Canada has to be involved in regional development, came from the late Harrison McCain. Mr. McCain was a great New Brunswick entrepreneur who began the McCain Foods global enterprise which operates in dozens of countries around the world.

McCain Foods began as an idea to process potatoes in a village called Florenceville, New Brunswick. In the 1970s, when the two McCain brothers, the late Harrison McCain and Wallace McCain, decided to open McCain Foods, they could not find a commercial lending institution that would give two entrepreneurs from rural New Brunswick the millions of dollars they needed to set up their first french fry production facility.

The department of regional industrial expansion existed at that time in the Trudeau government. That was the federal economic development agency which decided to partner with McCain Foods in rural New Brunswick. I have heard Harrison McCain tell the story himself about the interest of the Government of Canada in helping people in the small village of Florenceville. Florenceville probably has a population of less than a few thousand. It is an hour and a half drive from the city of Fredericton, along the Saint John River Valley in New Brunswick, known as the potato belt because it is a very fertile area for growing potatoes. If the Government of Canada had not stood by the McCain brothers in the 1970s, we would not have a globally competitive business called McCain Foods operating in almost every continent called.

When we think of what the importance of a small investment meant at that time to the future economic prosperity of a company as important, I would argue, to Canada and to our export picture as a food-producing country as McCain Foods, then we have not understood the importance of the federal role in regional development.

That brings me back to my colleague's bill, Bill C-309, which seeks simply to give FedNor the same status as the other economic development agencies. It does not seek, as some Conservative members would assert, to increase the budget or duplicate administrative costs, or set up a corporate service branch that does not exist now. As my colleague accurately described, these services currently exist within the program operated as FedNor. What does not exist is the legal status of an agency with a mandate from this Parliament to operate in the interests of the economic development of a region as important to our country as is northern Ontario.

Consider the difficulties in the forestry sector, for example. My colleague from Nipissing—Timiskaming has spoken many times about the challenge the American subsidies around black liquor represent for the Canadian pulp and paper industry. It is a very critical time for this industry. Thousands of jobs have already been lost. Tens of thousands of jobs are threatened. The government needs to get engaged in the fight to support these industries, workers and communities.

If we do not have a separate agency like FedNor, which can understand the economic challenges of the forestry or mining sectors in the economy of northern Ontario, and we simply rely on the Department of Industry on Queen Street in Ottawa to be interested in the difficulties of operating a sawmill in a small remote community of northern Ontario where there is the challenge of building logging roads across a vast expanse of territory, then we have not understood the importance of building a truly national economy.

If the Conservative government were sincere about wanting every region of the country to prosper, it would stand up for FedNor. It would not bury it in some office at the Department of Industry in Ottawa. It would give it a legal status similar to ACOA, which is an agency that is so important to my region in Atlantic Canada, or to DEC, Développement économique Canada pour les régions du Québec. It would support Bill C-309, which I think is a great testimony to the commitment of my colleague from Nipissing—Timiskaming to northern Ontario.

[Rick Dykstra, Conservative, Parliamentary Secretary to the Minister of Citizenship and Immigration]

Mr. Speaker, I am pleased to have the opportunity to speak to and discuss the implications of private member's Bill C-309.

The bill proposes, at a significant cost to the taxpayer, to create a new federal agency with its own deputy minister and with its own bureaucracy to administer economic development programs exclusively to northern Ontario. Bill C-309, in essence, aims to create an agency to do what FedNor, a program administered by Industry Canada, is already doing and doing quite well.

Communities and rural areas in northern Ontario continue to face challenges that affect the stability and the development of their economy, both in the short and in the long term. Some of these challenges include: geographic isolation from large urban markets to the south; limited telecommunications and transportation infrastructure; static or declining population; a high youth out-migration rate; lower than average employment growth; and limited ability and capacity to respond to the current global economic slowdown.

This great part of our country certainly deserves the support of Canada's government, and I am proud to say that FedNor has been leading the way for years.

Since its inception in 1987, FedNor has been operating successfully within Industry Canada. On a daily basis, FedNor staff work with a diverse client base in an effort to build a stronger and more prosperous northern Ontario. These clients include business leaders and professional groups in the areas of tourism, transportation, telecommunications, resource industries, small business, health research and education.

It appears that the intention of my hon. colleague, the member for Nipissing—Timiskaming in tabling this bill is to ensure that the government will provide the support that northern Ontario needs to continue to thrive. Today, FedNor is providing this support and it is doing so quite successfully, I might add.

To understand the implications of the bill, we need to turn the clock back just a bit.

In 1987 the federal economic development initiative for northern Ontario, FedNor, was created to serve the economic development needs of the northern part of this province. It was established as a program within Industry Canada, within its regional operations sector, where it still remains today.

It was in 1995, some eight years later, when Industry Canada, through FedNor, became responsible for administering the community futures program across rural Ontario.

In other regions, the community futures program is administered by the three existing regional development agencies in Canada: the Atlantic Canada Opportunities Agency, the Western Economic Diversification and the Economic Development Agency of Canada for the Regions of Quebec.

What makes the community futures program unique is that each community futures organization counts on the expertise of volunteer boards made up of local residents who bring a variety of expertise to the table.

The community futures program builds on the philosophy that local residents are best positioned to make decisions about the future of their communities. The program has become a driving force for business and for community development across the province of Ontario.

We move some seven years later to 2004 when FedNor took on the responsibility of administering the new eastern Ontario development program. The success of this program can, in part, be attributed to the excellent administration and flexible management structure from which FedNor currently benefits by being part of Industry Canada.

In addition to the responsibilities I have mentioned, FedNor also administers funding for the economic development of official language minority communities in Ontario. This has involved coordinating consultations with our official language minority communities to identify gaps and to identify needs.

FedNor has taken a lead role in promoting the vitality of these communities by working with its community futures partners to bring about service improvements. These efforts are helping to ensure that the community futures development corporations have the support they need to meet the official language needs of their communities.

In the past, FedNor has administered other initiatives in Ontario,on behalf of the Government of Canada, such as the softwood industry community economic adjustment initiative.

[The Acting Speaker, Conservative, Barry Devolin]

I must interrupt the member. When the House returns to this matter, he will have five minutes remaining.

The House resumed from May 14 consideration of the motion that Bill C-309, An Act establishing the Economic Development Agency of Canada for the Region of Northern Ontario, be read the second time and referred to a committee.

[The Deputy Speaker, Conservative, Andrew Scheer]

I am now prepared to rule on the point of order raised on May 14, 2009, by the hon. Parliamentary Secretary to the Leader of the Government in the House of Commons concerning the need for a royal recommendation to accompany Bill C-309, An Act establishing the Economic Development Agency of Canada for the Region of Northern Ontario, a bill standing in the name of the hon. member for Nipissing—Timiskaming.

I would like to thank the parliamentary secretary for having raised this matter, as well as for his detailed submission.

In presenting his case, the parliamentary secretary noted two aspects of the bill which he argued violated the financial prerogative of the Crown.

First, since the bill seeks to establish a new government agency, the economic development agency of Canada for the region of northern Ontario, he argued that the establishment of a new department or agency entails those operational expenditures necessary for it to function on a day-to-day basis.

Second, he made reference to the fact that the bill provides for the appointment of a variety of officials and other personnel. He indicated that since remuneration or the possibility of remuneration is provided for in the bill, a royal recommendation is therefore required.

I have carefully reviewed Bill C-309 and given particular attention to both the establishment of the new agency and the appointment of various officials and employees proposed in the bill.

With regard to the establishment of a new agency, the parliamentary secretary cited a ruling of July 11, 1988. As the parliamentary secretary noted, in that ruling the Chair stated that an amendment to establish a separate government department “undoubtedly would cause a significant charge upon the federal treasury in order for the new department to function on a daily basis.” (Debates pages 17366-7) This observation is just as valid when applied to Bill C-309. Accordingly, the Chair believes that the establishment of the Economic Development Agency of Canada for the Region of Northern Ontario, as proposed by Bill C-309, would give rise to new and distinct government expenditures, thus requiring that the bill be accompanied by a royal recommendation.

Bill C-309 also provides for the appointment of members of an advisory committee as well as an agency president, and their remuneration is stipulated in clauses 4 and 9 of the bill. It is well established that such salary provisions constitute a charge on the public treasury.

Furthermore, clause 13 provides for the appointment of officers and employees in accordance with the Public Service Employment Act. Undoubtedly, such appointments would necessarily include remuneration and thus would also involve a new government expenditure.

Clearly, Bill C-309, by providing for both the establishment of a new agency and the appointment of officials, involves the expenditure of funds. Such spending, for a new and distinct purpose would need to be accompanied by a royal recommendation.

Consequently, I will decline to put the question on third reading of the bill in its current form. Today, however, the debate is on the motion for second reading and this motion shall be put to a vote at the close of the second reading debate.

Resuming debate. The hon. Parliamentary Secretary to the Minister of Citizenship and Immigration has five minutes remaining in his time slot.

[Rick Dykstra, Conservative, Parliamentary Secretary to the Minister of Citizenship and Immigration]

Mr. Speaker, I have been waiting patiently, but certainly looking forward to concluding my remarks on Bill C-309, which proposes, at a significant cost to the taxpayer, to create a new federal agency, with its own deputy minister and bureaucracy, to administer economic development programs exclusively to northern Ontario.

If we are to make these kind of expenditures, I think it should be on the stimulus package and the efforts that have gone forward in this budget to help Canadians versus to build a larger bureaucracy.

Nonetheless, to summarize, in addition to some of the initiatives that I had mentioned previously, the FedNor organization today administers two very important programs that directly benefit northern Ontario: the northern Ontario development program, which is the program that represents the organization's original mandate to serve these areas; as well as the community futures program. These programs serve as a foundation of FedNor's holistic and highly successful approach to community economic development. Unfortunately, the organization's evolution, which I have tried to capture in my comments, has led to confusion about FedNor's role and responsibilities.

Please allow me to clarify.

Because of its original mandate to serve northern Ontario exclusively, some have been led to believe that FedNor funding aimed at northern Ontario is somehow flowing south. Nothing could be further from the truth.

What is important to understand is that what used to be referred to as the FedNor program has now become the northern Ontario development program. Through this program, FedNor, the organization itself, funds economic developments exclusively in northern Ontario. Even though FedNor has grown and some programs have involved delivering provide-wide funding, each of these programs, including the northern Ontario development program, has its own distinct budget.

In fact, the northern Ontario development program and its budget has steadily increased over the years. Today, it is much larger than it was when FedNor started assuming responsibility for the other two programs. This means that funds destined for northern Ontario are not flowing south, contrary to what is being claimed by some members in opposition.

Let me be clear. Even though the organization has received increased responsibilities over the years, these have not detracted from FedNor's focus on northern Ontario. Bill C-309, in essence, aims to create an agency to do what FedNor is doing today through its northern Ontario development program. However, as it stands, the bill would effectively turn back the clock on the progress made by FedNor. The bill, as written, would remove the flexibility that has helped make FedNor so valuable to the people it serves.

Recently the Government of Canada announced Canada's economic action plan, which will provide much needed support for businesses, industry and all Canadians during economic slowdown. As part of that plan, FedNor will be administering northern Ontario's share of the $1 billion, over two years, allocated to the new nationwide community adjustment fund. FedNor's flexibility to deliver this type of programming is what makes the organization so effective.

I should also note that delivering additional programs like the community futures program and the community adjustment fund actually creates jobs in northern Ontario. By delivering these initiatives through an established organization like FedNor, instead of creating new layers of bureaucracy, the Government of Canada and all citizens benefit from important cost savings.

The clients of the community futures program and other FedNor-delivered initiatives also benefit by drawing on FedNor's substantial program delivery expertise and recognized sound management practices. The potential severing of the community futures program, which supports 24 community futures organizations across northern Ontario, would have a particularly negative impact on northern residents. FedNor has established long-term relationships with hundreds of community futures staff and volunteers who serve on these boards. These relationships have been built over many years and have created strong bonds between the federal government and community stakeholders.

Let me illustrate this by making a point. At last year's Ontario Association Community Futures Development Corporations annual conference, prior to the minister's keynote address, the board chair told the 250 delegates in the room that, “Not only does FedNor enable access to the funding which fuels the efforts of our respective organizations, but it's the ongoing management of the program and the advice they give us combine to give us a serious strategic advantage”.

In short, Bill C-309 aims to create a new entity to what FedNor already does, through the northern Ontario development program, yet it would limit the capacity of FedNor to contribute to other economic development initiatives in northern and rural Ontario.

[Carol Hughes, NDP, Algoma—Manitoulin—Kapuskasing, ON]

Mr. Speaker, I am glad to add my voice to the debate tonight.

I would like to acknowledge the member for Nipissing—Timiskaming for introducing Bill C-309, An Act establishing the Economic Development Agency of Canada for the Region of Northern Ontario.

I would thank the member, but I must remind the House that his party had ample time to implement what it is calling for today and chose not to do so. That is the curious case of the Liberal Party. It says in opposition what it dares not do in power. It is entirely predictable really, but it is also a bit sad. We do not know which version to believe, which version to take at face value.

On this issue, we seem to view things in a similar light, and I would like to think the Liberals believe what they say. What I would also like to think is the Liberals will act on their beliefs. I would like to think it, but sadly, history does not back this up.

Recent parliamentary history is full to brimming with tales of Liberal about-face manoeuvres. Issue after issue they have turned coat and run from them. We have come to expect it. We know they like to sound like New Democrats for public consumption and then act like a backroom, Bay Street, old boys' club, charter members when the doors are closed and the real decisions are made.

We know we cannot count on the Conservatives to support a stand-alone agency from FedNor. That may partially explain the terrible showing they had in northern Ontario in the last federal election. The Conservatives see FedNor as nothing more than an adjunct office for the ministry of industry. They have consistently rebuked calls to have FedNor made into a stand-alone agency.

That pretty much leaves New Democrats to fight for this change. We have the courage of our convictions and remain steadfast in our beliefs. New Democrats see that northern Ontario is a unique region that presents unique economic challenges and requires a stand-alone agency to be able to deliver concrete strategies that will allow this region to bloom.

Northern Ontario is rich in resources. Among many other things, we are miners and foresters, mill workers and farmers. There is a strong tradition of entrepreneurialism that makes for a vibrant society. This needs to be encouraged further. We should be doing all we can to help. We should be scouring the region for every opportunity to grow the economy even more. An independent FedNor would go a long way to helping with this.

If people felt that FedNor was a responsive agency that was in place to help northern Ontario develop opportunities, there would be a stampede to take them up on that. Instead we have an ineffective agency that is defined more by what it is not and those who feel left behind, out in the cold and on their own.

Earlier in this debate, we heard from my colleague, the member for Nickel Belt. He had a laundry list of FedNor failures, of opportunities lost or in danger of being lost. Why? Is it because there is not the political will on the other side of the House to help this region? Is it because it is not sexy enough? Is it because there are relatively few seats for the amount of work needed to really hear the residents of northern Ontario? Is it because those members see the north only as a place from where raw resources come? I would really like to know because my constituents will tell us that often it is the way we feel like we are being viewed.

My colleague from Nickel Belt rightfully pointed out that FedNor must be able to adapt to the changing economy and ensure the economic prosperity of the workers of northern Ontario and their families. Its mandate must be drawn up at the local level by the people who live in the region, not by some faceless bureaucrat in the Ottawa offices of Industry Canada.

I would like to address a second point and give an example of the inability of the agency to understand the true nature of northern Ontario.

In northern Ontario a lot of our buildings are multi-purpose structures. Many of these buildings have health care components to them. It could be a clinic or a public health office. I want to make it clear that we are not talking about hospitals here. The problem is because of these health care components in these multi-purpose buildings, everything else in that structure is automatically disqualified from FedNor funding, a classic example of the agency having no real understanding of the true nature of the region it is meant to serve.

If only that were all we had to say about the delivery of services from FedNor. I have seen first-hand how even approved projects take forever to negotiate. In Nairn Centre, a feasibility study for a project that will run water to Baldwin Township has finally been approved after a lengthy application process.

Long delays ignore the fact that smaller centres do not have the budgets to be able to employ an engineer. They bring in consultants. The consultants offer tenders for a project within a given timeframe. When a project incurs long delays, these tenders can expire. Ultimately, when the project is ready to proceed, there may be no engineering consultant in place and tenders need to be resubmitted. The cost can be thrown out of whack if fees increase over these long periods.

I have seen how FedNor has given the town of Hearst the complete runaround in its attempt to help with a proposal to create a green technology centre. It told the town that it should repurpose the initial application and make it a business centre as opposed to the tourist centre that was originally envisioned. Hearst took that advice and re-applied. When it heard back from FedNor next, it was to say the application was not appropriate for FedNor and that it should submit it somewhere else. What a shame.

It makes people shake their heads. It makes them wonder if FedNor is in place to make these small towns burn through all their resources on proposals.

I know that FedNor is not working as well as it could or should. It is a small cog in a larger department and is treated like a poor cousin, just as northern Ontario is often treated. The bill would go a long way to rectifying some of the problems we see with FedNor today. By making it a stand-alone agency, it could be more responsive and flexible.

This is repurposed legislation that was originally drafted by the member for Sault Ste. Marie. I would like to salute him for his tireless work over the years on behalf of the residents of northern Ontario. His vision for FedNor is one to which New Democrats will honour and remain committed. When we make it to that side of the House, we will not forget our commitment.

As we can see, a stand-alone FedNor agency for northern Ontario would be the best way to go. Many of my communities have indicated the need to ensure we have a proper FedNor program in place. They are struggling right now, given the fact that northern Ontario has been hit so hard with job losses.

I encourage the member for Nipissing—Timiskaming to ensure that Liberals will be supportive of this bill. I know they have introduced it, but we need to ensure they will save face and ensure it gets put in place.

Over and over again, my communities have indicated the need for a stronger FedNor program and to ensure it is stand-alone.

[Greg Rickford, Conservative, Kenora, ON]

Stronger than ever, record investments.

[Carol Hughes, NDP, Algoma—Manitoulin—Kapuskasing, ON]

The member for Kenora can provide all the rhetoric he wants, but we know he does not support these issues. We need to ensure our people are well taken of in the north.