The Yukon government is spending $31 million to improve the Campbell Highway.
That’s a pile of money.
There is little doubt the road needs work. Those who drive it complain it is narrow, twisty and dangerous.
But it is also little used.
In 2006 (the last year that full statistics are available) the average traffic volumes beyond kilometre 10 on the Campbell Highway, the area closest to Watson Lake and the access road to its airport, was 145 vehicles a day averaged over a full year. That’s as good as it gets.
Beyond kilometre 110, the highway saw only 17 vehicles a day averaged over the year.
At the intersection of the South Canol Road, there was an average of 88 vehicles using the highway every day, but that was only over four months (90 days). After that, there is no data available, probably because outside summer nobody drives the Canol — it is not maintained in the winter.
By comparison, the Alaska Highway by Swift River sees an average of 541 vehicles a day, the South Klondike Highway near Carcross sees 565 vehicles a day, the North Klondike Highway beyond Stewart Crossing sees 180 vehicles a day and the Dempster sees 109.
To spend $31 million to benefit 145 Campbell drivers a day ($214,000 apiece) is ludicrous. To spend it for 17 is criminally wasteful.
So what is going on?
Well, the road is in Premier Dennis Fentie’s riding, so there’s a large element of pork barreling going on.
But there’s also some economic development at play.
By economic development, we mean direct subsidy of the mining sector.
The Campbell cuts through a mineral-rich region of the Yukon. Improving the Campbell will directly benefit Outside corporations that mine the region and ship concentrate down the road.
Currently, there is only one mining company using the road. That’s the Cantung Mine, located in the NWT.
A smoother, wider, safer road benefits the mine’s owner, Vancouver-based North American Tungsten Corp.
But is it the best use of the Yukon’s capital budget?
The Canadian Taxpayers Federation doesn’t think so.
It calls it corporate welfare.
If a company benefits from the roadwork, it should pay for it, said its spokesman Scott Hennig.
That’s how it’s done in Alberta, he noted.
And if a company can’t pay for the needed improvement, then it probably isn’t viable.
It’s not a bad litmus test. And it provides a public benefit from the operation in the form of better public infrastructure.
The Fentie government isn’t the first to engage in flagrant subsidy of large industry in the territory.
Sawmills, lead-zinc mines, and gold mines have all benefited from significant public investment, roads and power deals.
Most of these subsidies were offered during a time of low metal prices and foundering economy, an attempt by government to prime the pump.
All the companies operated for a short time, then went belly-up.
It’s time to learn from these mistakes.
Times have changed, metal prices are high and the territory’s mineral wealth is coveted internationally.
If companies want our roads improved for their benefit, they should pay for it.
There is no shortage of projects in the territory that need public funding.
Spending $31 million on the Campbell isn’t one of them. (Richard Mostyn)