Budget business

The 2010 federal budget unveiled last week had little in the way of new spending, though one investment in Newfoundland and Labrador is receiving cautious praise locally.

$175 million has been earmarked for Marine Atlantic, the Crown Corporation handling the ferry service between Sydney, N.S. and terminals in Port aux Basques and Argentia.

"Marine Atlantic has been an issue for us for a number of years," said Troy Freeborn, president of the Gander and Area Chamber of Commerce.

Delays due to weather and mechanical issues has affected both tourists and supplier of goods to the island. Delays can be particularly detrimental when the shipment of perishable goods is involved.

Mr. Freeborn said its service is essential to the island, and any investment in fleet and shore facilities is "a step in the right direction.

"We're still going to keep a watchful eye on it, to make sure it does indeed have an impact to the quality of service for the island."

How that might play out remains to be seen.

Gerry Byrne, Liberal MP for Humber-St. Barbe-Baie Verte, told reporters last week he discussed the $175 million investment with Transportation Minister John Baird.

Mr. Byrne said he was told the federal government intends to acquire two sister-ships of the new Atlantic Vision, with these funds to cover the cost of bringing the ships up to Canadian marine safety standards.

Minister of State for Transportation Rob Merryfield, speaking with The Beacon's sister paper The Telegram, said Mr Byrne "has not got a clue what we're going to do with that money."

Gander deputy mayor Zane Tucker said he supported the government's move to work towards paying down the deficit in the upcoming years.

"We as a town always try to keep our spending in control, and we do a five-year projection to see where trends are going to be - if costs or debt are going up, we try to keep a handle on that. It's encouraging to see they're not going to let that deficit balloon and balloon," he said.

Deficit dilemma

Mr. Freeborn, who also serves as president for Heli-One Composites in Gander, said the plan to move away from deficit spending is sensible form a business standpoint.

"As a business person, it's a welcome thing to see the government does not plan on running deficits."

Otherwise, Mr. Freeborn said most budget measures seemed to focus on the continuation of previously announced measure, many of which he considers beneficially to the area.

Deputy Mayor Tucker echoed that point.

"It doesn't seem to have too much new spending," he said.

Mr. Freeborn said continuation of the tariff-free zone policy for manufacturing is a positive move, as is the downward trend on the business tax rate, expected to hit 15 per cent by 2012.

A new Atlantic Innovation Fund for the Atlantic Canada Opportunities Agency will be good for people in the region, said Mr. Freeborn.

The budget also outlined the government's plans to continue with spending through the $4 billion Infrastructure Stimulus Fund in 2010. The fund is set to expire at the end of March 2011.

Deputy Mayor Tucker said municipalities have fair warning on what has been committed, which is helpful to know in advance. However, he would not mind if the program was extended.

"Obviously, municipalities would love to see it, because it gives you more money, and the citizens have to come up with less money for a big project."

However, Deputy Mayor Tucker also said the need to find a fiscal balance does not always allow for such programs to continue.

Churence Rogers, mayor of Centreville-Trinity-Wareham and small towns director for Municipalities NL, said the federal government definitely had to think about where it would be in the years to come when considering infrastructure spending.

"You have to control spending there, or else they have to raise taxes. Personally, I'm not sure whether they could have sustain that program for the long-term," he said.

Of note, Mr. Freeborn said people may want to keep an eye on the federal government's plans to restrain the growth of national defence spending.

"It's a good thing, I suppose, in that they're noting the growth will continue in Department of National Defence spending, but they're going to restrain the rate of growth. That's something to keep an eye on, because you don't really know how they're going to implement a statement like that."

Last year, Minister of Defence Peter MacKay announced a $42.5 million project to construct new buildings for 9 Wing Gander.

Mr. Freeborn also pointed to the government's plan to review government administrative functions.

"If you're doing a review of what the benefit of a certain service or office has ... it's usually the smaller areas that get hit. Most of those places rely on those government offices for economic stimulus and jobs for those regions."

info@ganderbeacon.ca