In the weeks before the federal budget, Industry Minister Tony Clement, the political minister for Northern Ontario, was sprinkling money around the region.
Atikokan got $60,000 to expand its Bass Classic fishing tourney. Nipigon received $100,000 to "identify options for managing and developing the Long Lake/Ogoki and Nipigon Diversion Watershed systems." Fort Frances welcomed $239,000 for the Riverside Health Care facility. Burk's Falls enjoyed $21,000 for a feasibility study of a community education complex. Five projects were announced for the Nipissing-Timiskaming region, 15 for Greater Sudbury.
These and other announcements were all presented by FedNor, a regional development agency under Industry Canada. Mr. Clement unveiled them all as part of "Standing Up for Canada's Economy," a slogan that just happened to be the one used by the Conservative Party in the 2006 election.
FedNor has been around since Brian Mulroney's days as prime minister. Now, courtesy of the Harper government budget, Southern Ontario will get its very own regional development agency. As a result, four decades after Ottawa focused assistance in Atlantic Canada and eastern Quebec, the entire country is now covered by regional development.
In 1968, prime minister Pierre Trudeau's government decided to establish a government department - the Department of Regional Economic Expansion (DREE) - essentially for Atlantic Canada and eastern Quebec. Eighty per cent of DREE's budget would be spent there, for the very good reason that the need was greatest in those areas of chronic high unemployment.
It did not take long for political envy to do its work. Ministers in Montreal, aware of the rise of separatism and believing the city to be the motor of Quebec's economy, lobbied successfully to extend DREE to the entire province of Quebec for grants to industry. The target of regional development, in other words, suddenly got a whole lot larger.
Other envious regions wanted in on the action, so General Development Agreements were signed with provinces, allowing Ottawa to sprinkle money across Canada under the guise of regional development. DREE morphed into the Department of Regional Industrial Expansion.
Programs came and went. An alphabet soup of initiatives developed.
Finally, it was decided to create an agency rather than a department, so the Atlantic Canada Opportunities Agency came into being. Quebec got its own federal funding program for regional development.
And there matters stood, until Mr. Mulroney decided to spread federal largesse even more widely by establishing FedNor and Western Economic Diversification Canada (WEDC), headquartered in Edmonton, with a mandate to do a form of regional development by spreading the Western provinces' economic base beyond commodities.
Until the current recession, of course, the three westernmost provinces' economies were on fire. No reasonable rationale could therefore be found for Ottawa to have a "regional development" strategy for the fastest-growing region in the country - except that one existed and no one in the media or politics dared to question its existence.
It was and is a classic case of government agencies and programs, once created, being almost impossible to shut down. Woe betide any government that takes away an entitlement or closes down a program that some region considers its very own, especially if some other region has something similar.
It's an important lesson in the context of the Harper budget, which promises lots of two-year initiatives that are supposed to end thereafter. If regional development's history is any guide, they won't.
The Liberals kept WEDC going because closing it would have left the party accused (again) of being insensitive to the West. The Conservatives, supposedly fiscal hawks, kept it going because the West is the party's political base. So, in fiscal 2008-2009, WEDC spread $269-million across the best-performing provincial economies in Canada.
WEDC's existence mocks the original idea of serious regional development focusing money on the least-advantaged parts of Canada. The mockery is now complete, because the Harper government has just announced "more than $1-billion" over five years for a "Southern Ontario Development Agency." Pockets of Southern Ontario have been hit hard, but the overall unemployment rate remains below that of the regions originally targeted four decades ago.
Canada no longer, therefore, has a regional development policy, nationally speaking, but a series of funds, to be spread around the entire country as civil servants and their political masters see fit.