by Liz Hanson
Thanks to the Yukon Party, Yukon has become a case study in how not to run an economy.
The Conference Board of Canada recently confirmed that Yukon’s economy has shrunk for three consecutive years.
In the face of the global downturn in commodity prices which will see the Minto mine – the last active resource extraction project in the territory – wind down over the next year, Yukon’s government continues to choose to invest in massive projects over smaller, scalable projects. In doing so, the Yukon Party overwhelmingly awards contracts to large national or multinational firms instead of northern or local ones.
In conversations with many Yukoners over the past months, people often ask me why the Yukon Party refuses to focus on the basics of economic development by hiring Yukon firms for Yukon projects.
Yukon companies are doing their part by being good neighbours; just look at Air North’s recent recognition as the second most-loved airline in the world. As one of the largest non-government employers in the region, Air North is a great example of an effective private sector-First Nation partnership that has led to substantial positive economic benefits across Yukon’s economy.
The Yukon Party is quick to stand behind Yukon businesses when things go well, but on economics there is a glaring discrepancy between what the Yukon Party says and what it does. Rather than focus on encouraging the development and diversification of Yukon’s economy, the Yukon Party has repeatedly spurned opportunities to do so by repeatedly choosing massive projects over small, scalable ones and large national or multinational firms over northern and/or local ones.
Let’s take a look at some examples of the Yukon Party’s outsourcing in action.
The Yukon Party government recently awarded a five-year care and remediation contract for the abandoned Faro mine to Parsons Corporation, a California-based company that describes itself as “successful in winning environmental and mining projects in Northern Canada” and that is committed to “aggressively pursuing additional northern projects”.
Ironically, the Faro mine remediation is the Yukon Party’s only sustained mining-related work since the 2003 Devolution Transfer Agreement. For 13 years, Canadians have been on the hook, through the Yukon government, for ensuring that the mine’s toxic tailings are contained – forever. We still have no clear idea of how the government will contain the tailings, how much it will cost (or has cost so far), nor do we know how many local jobs have been generated through this ongoing project.
Parsons is no doubt eminently qualified to work in diverse fields; one would expect no less from a corporation with in excess of $3 billion in annual revenue. For a company of this size, paring off a few million to undercut other bidders is a simple example of a loss leader. They have their eye on the prize: the many millions of dollars’ worth of northern mine cleanups… and they have the money to trump smaller, local bids.
The decision to award the Faro contract to this large multinational company is not isolated.
Let’s not forget the Yukon Party’s decision to quietly hand the Employee Assistance Program over to Morneau Shepell, the Toronto-based human resource and outsourcing juggernaut. A Yukon government evaluation showed satisfaction with the services provided by a small local organization with highly qualified and professional staff – so why did the Yukon Party insist on offering another slice of Yukon’s government services to an Outside company?
The Yukon Party recently poured salt on Yukon’s unemployment woes by cutting funding to the YuWin job board – considered by many to be the best resource in Yukon for both local employers and Yukoners looking for work alike – and instead diverted that money to a Canada-wide job site. In public statements Yukon business owners spoke out against defunding the YuWin job board; in a letter to the editor, one said that “without YuWin we will be left without an effective online tool for the purpose of filling vacancies with local job-seekers.”
The Yukon First Nations Chamber of Commerce and the Whitehorse Chamber of Commerce have both recently indicated that the Yukon Party’s actions ignore our local potential. Yukon is proud to be the home of many capable and locally managed companies that could, either independently or in collaboration with others, complete this work while enhancing northern capacity and innovation. And the best part about it? They live in, and contribute to, our local Yukon economy.
As the Yukon NDP’s finance critic, I regularly ask the Premier about the business case analyses that support his government’s decisions. I have provided him with examples of the many studies that show how supporting local businesses has a significant economic multiplier effect across the community.
I encourage Yukoners to look more closely at the Yukon Party’s record, and ask the question behind the question. Check the list of contracts tendered by the Yukon Party government since 2002 for projects like hospitals, schools, fibre optic proposals, transmission line extensions, mine remediation and continuing care facilities. Ask for the total final cost for projects versus their projected cost. Ask for the evidence of a business case analysis prior to the awarding of contracts. Ask which firms the Premier and /or his ministers met with prior to awarding those contracts.
The Yukon NDP caucus and I have asked these questions. The record shows that they remain unanswered.
These questions are important. And with a territorial election looming, there could soon be a government that believes Yukon citizens have a right to know.
Liz Hanson is the MLA for Whitehorse Centre and the leader of the Yukon NDP Official Opposition.