Thank you, Mr. Chairman. First I'd like to extend regrets from our president, Monica Ell. She wishes she could be here in person today; unfortunately, you're stuck with me.
I'll introduce myself. My name is Mark Morrissey, and I am vice-president of the Nunavut Economic Forum. This morning I will begin with a very short introduction of what the forum is and the role it plays in economic development here in Nunavut.
The Economic Forum, or NEF, as it's referred to, is a broad group of member organizations developed to identify and share information on economic development activity in Nunavut. Members of the NEF include community organizations, non-profit and non-government associations, members of the private sector, Inuit associations, and all levels of government. These individuals and groups all have one thing in common: a desire to see Nunavut build a solid foundation for economic development and growth.
The primary focus of the NEF is to bring members together to collaborate on the implementation of the Nunavut economic development strategy, or NEDS, to support research and data collection related to the economy of Nunavut and to report regularly on progress being made. Accordingly, the NEF produces a number of publications and discussion papers, which are circulated among members and economic stakeholders. Among these is the Nunavut Economic Outlook, a biennial report that provides informed analysis on social and economic issues and constructs a comprehensive forecast of the whole economy.
Unfortunately we don't have translated copies of the 2008 Nunavut Economic Outlook, along with the strategy, so I'm not able to provide it to you. But if you are looking for any of these documents, you can find them on our website, www.nunavuteconomicforum.ca. The website you have listed in your briefing notes is incorrect. I will add a caveat to the 2008 outlook, however. It was published in December 2008, just prior to the global recession, and some of the projections may be a little dated. It is a useful document, though, to illustrate the economic potential that exists in the territory.
The NEF, through its broad membership and mandate, is uniquely positioned as an organization to see the challenges that are apparent in many economic sectors in the territory. Many of these have already been identified in the strategy, and I will list a few here. They include these but are by no means limited to them.
The first is rapid population growth. Nunavut has one of the youngest populations in Canada, and I would encourage you to look at the population graph and compare Canada and Nunavut. There's a very stark contrast. The youth in this territory, defined as those under the age of 25, are part of the consumer society in Canada and have high expectations in terms of employment and quality of life. While many regions in Canada would see a young population as an opportunity, it provides a challenge in Nunavut as these individuals make up a significant portion of the unemployed. If more employment and better education cannot be provided to this demographic, they will prove to be a significant economic drain.
Rate of government spending is also a barrier. Government growth is currently driving the Nunavut economy. Government activities provide employment and training opportunities, but government spending cannot be counted on indefinitely. During periods of economic hardship and deficit spending, such as those being encountered now, cutbacks to programs and activities are inevitable. Efforts must be taken to ensure private sector activities are able to provide greater contributions to economic growth. However, it is important to note that until a stable local economy can be established in Nunavut, government cutbacks should not be made to northern programming, as the effect that would have would be multiplied.
There is a lack of understanding of the north, which we've already heard from several speakers. Currently in Nunavut, organizations and businesses can access a number of federal programs from various departments, which can be used to support economic activities and in many cases stimulate growth at the local level. However, these programs are often not designed to incorporate the realities of operating in the north, and those individuals tasked with managing them are not familiar with the territory and the challenges we face here. For example, many federal departments do not offer multi-year contribution agreements and often impose unrealistic reporting requirements, which impacts on what an organization can do with available funding. For example, new year funding is often withheld pending submission of activity reports and, in many cases, audited financial statements.
Realistically, at least here in Nunavut, many organizations are not able to provide audited statements until September. That being the case, organizations that are intending to use funding to purchase equipment and supplies have already missed the cutoff dates for sealift and are now forced to fly in goods at a much higher cost.
Some federal departments have programs available to organizations in the territory but have no staff in place to promote them or administer them. I hate to pick on a particular department, but a good example would be Industry Canada. Until very recently, Industry Canada had no staff here in the territory, despite having a number of programs available. Their programs are, to a large extent, virtually unknown to organizations here and are highly underutilized.
Funding is also allocated on per capita calculations, not realistic assessments of the costs of doing business. Another example, and I will pick on a department, is Foreign Affairs' ICCI funding--the Invest Canada Community Initiatives program. This program currently has only $26,660 allocated to Nunavut and the Northwest Territories combined, despite these regions having the highest cost of living and doing business in the entire country. Southern Ontario, by comparison, has over $1 million allocated to that region alone. I think there's a bit of a disparity there.
Regarding lack of capacity, it's no secret that Nunavut lags behind the rest of Canada when it comes to ability of the region to develop and implement successful economic activities. The human resources and infrastructure often do not exist to initiate and sustain growth. Efforts are currently under way to establish and improve existing capabilities of communities in terms of the physical infrastructure. However, these efforts will be futile if the knowledge and training does not exist to achieve the full potential of these improvements. This ranks as probably the most serious barrier to economic growth in Nunavut today.
What can we do to remove some of these barriers? To begin with, the lack of capacity, both in terms of human resources and infrastructure, needs to be addressed. Pushing programs designed to stimulate growth in an unprepared region is an exercise in futility, and ultimately doomed to fail. The focus must be on building capacity at the local level. Preparing the community for employment opportunities and ensuring the adequate infrastructure is available will provide a solid foundation on which growth can be built and sustained.
Priorities should be placed on economic development initiatives that incorporate an integrated approach. A successful example of this would be the housing trust, whereby the federal government has provided funding to build much needed housing in the territory, while at the same time providing local tradespeople with the hours they need to complete their apprenticeships. Both the infrastructure and skilled labour force are developed in unison and will remain in the community as a foundation for growth.
A second solution, which also addresses capacity issues, would be to focus on community economic development, or CED, rather than solely on business development. Community economic development is a bottom-up approach to development and involves the full participation and control by local community members. It recognizes that economic growth can be maintained only when people's basic needs are addressed. As such, municipal governments must receive strong regional and federal support if they are to properly develop and implement a CED agenda. This is achieved through federal organizations working in tandem with territorial and Inuit partners to develop flexible programming that can be tailored to meet the needs of communities. Collaboration between departments and various levels of government is critical.
Ongoing and sustained investments must have realistic expectations of results and be long term in nature. Currently most federal programs force communities to work within short-term fiscal cycles that limit the potential of CED. CED is a process that produces solutions over a period of years, not quarterly.
A third solution is to put key staff and decision-making authorities closer to the end users of available programs. This will ensure that information flows freely between administrators and communities and organizations, eliminating misconceptions and fostering a better understanding of the realities of operating in Nunavut. This was the position of the economic forum when asked to provide input on the creation of the new northern regional development agency. The forum strongly advocated that the headquarters be located here in Iqaluit and managed by a deputy minister capable of making decisions without having to obtain approval from department officials in Ottawa. We are pleased to see the federal government agreed with our position when announcing the creation of CanNor.
The NEF is also pleased to work with CanNor in reviewing and implementing the investment plan for the second round of SINED funding, which many of you will remember the NEF advocated strongly for renewal of. The forum also plays a key role in connecting members with the agency, bringing decision-making closer to the community level. We look forward to continuing our work with CanNor as the organization continues to grow and establish itself in Nunavut. This collaborative approach to delivering programs is successful and should be used to model future activities.
In conclusion, there are no simple solutions to address the many barriers to growth in Nunavut. Collaborative efforts between the federal government and industry stakeholders are fundamental to ensuring that sustained investments in economic growth produce long-term results. As a means to facilitate this cooperation and ensure everyone is working together to achieve a common objective, I would suggest that organizations and agencies, federal and territorial, obtain a copy of the strategy--which again is available on the website--and study its content. This document provides readers with a road map for development in Nunavut.
Thank you.