the northern economic development agency boon or boondoggle

I spent the Wednesday morning of this week in a crowded little meeting room in the Elijah Smith Building, hearing about, and spouting off a bit about, the federal government's proposed Northern Economic Development Agency. I was there in two capacities...

I spent the Wednesday morning of this week in a crowded little meeting room in the Elijah Smith Building, hearing about, and spouting off a bit about, the federal government’s proposed Northern Economic Development Agency.

I was there in two capacities: as the executive director of the Yukon Entrepreneurship Centre and (a little less officially) as the program manager for the Yukon Technology Innovation Centre.

(And I should take a second to make it clear that, though I appeared at the meeting in my official capacities, the opinions expressed in this column are my own, not those of either centre.)

Both organizations share, from slightly different angles, similar interests in seeing efficient, effective economic development programs take root in the Yukon, and have been directly active in trying to develop such programs.

The Entrepreneurship centre, was recently involved in a feasibility study on the idea of starting up a business incubation centre in the Yukon.

The technology innovation centre has a role in both the funding and the management of the very successful Yukon Business Development project.

Though my professional focus is naturally on the development of technology-based businesses in the Yukon, most of the challenges my techno-clients face are not much different from the ones faced by any entrepreneur in any market.

It follows, then, that, when the representatives of this new federal agency extended me an invitation to hear and be heard, I was quick to show up.

And I was hardly alone in doing so. As I said, the little room was packed to capacity with representatives from a whole heap of local business agencies—so many, in fact, the federal folks kept having to haul in more chairs.

I would not say the air was charged with excitement, but there was certainly a lot of interest in what was being proposed, and a lot of doubts, too, spoken and unspoken.

The basic proposition at the moment is that the government will spend million over the next five years on the set-up and operating costs of this new agency.

At the moment, the agency has no legislation governing the terms under which it is awarded and can dispense public funds; it is therefore initially associating itself with Indian and Northern Affairs Canada’s SINED program. (That’s Strategic Investment in Northern Economic Development.)

That program has some to spend over the next five years, spread out evenly at million per territory—so, in essence,  million in economic development money for each territory for each year.

Some eyebrows were predictably raised at the idea of spending million to create yet another government agency, and one which is not even—for the first phase of its life, at least—flowing any new funds into the economy.

As one frank-speaking representative from the tourism industry put it, this new federal organization had better prove itself to northerners; because if it turns out to be “horseshit” (his frank word, not mine), they and Stephen Harper are going to look very bad.

On the other hand, this same man, and most of the rest of us in the room, were inclined to give the idea a chance, because it promises to address, over time, some glaring deficiencies in the way the federal government handles northern development money.

There is a host of different federal government investment initiatives, all administered by different departments, all with different qualification and reporting requirements, and many of them with very woolly language around just what they are looking to accomplish and what they expect from an applicant.

If it takes another million to centralize and rationalize all that activity, the money is probably worth it.

Both of the economic development projects I currently have in my hands are at least partly dependant upon access to federal funding—either to stay afloat (in the case of the business development project) or get out to sea (in the case of the incubator).

As things stand, none of the available federal funding initiatives really meet the needs of either of these projects.

Both are predicated on achieving long-term economic payback to the territory, and upon having long term, multi-year financial support to allow them to achieve that payback.

Federal funding is just not structured to provide that.

It is all about short-term investments and quick results.

Federal financial assistance has traditionally been unpredictable in availability, hard to qualify for, late arriving, and ludicrously onerous in its reporting requirements.

That is why many organizations who could use the help just can’t be bothered applying for it.

As one jaded but clearly knowledgeable attendee at the meeting said, it is easy to get federal money to do a study about a good idea, but it is all but impossible to get any money to get a good idea actually working.

If this new Northern Economic Development Agency proves to be the body that can put some predictability, vision and common sense into the federal government’s investments in the northern economy, it will be a boon to all northern businesses and business initiatives.

If it does not, it will stand convicted as just another federal government boondoggle.

Rick Steele is a technology junkie who lives in Whitehorse.

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