Creation of new N.S. Crown corporation has opposition concerned about patronage

Nova Scotia's opposition party leaders are concerned Premier Tim Houston wants to bring back "old school" partisan decision-making to the province.

They are worried bills before the House this sitting to bring arm's-length government agencies and corporations back under direct ministerial control are a money grab.

Changes to the law would allow cabinet, not independent boards, to decide where millions of taxpayer dollars are spent.

Nova Scotia Business Incorporated is a case in point.

When he introduced the bill to create Nova Scotia Business Incorporated more than two decades ago,Gordon Balser, the PC economic development minister, alluded to the fact the Hamm government was hoping to end pork-barrel politics in the province.

"All Nova Scotians must have confidence in the motives and the decisions around economic growth and development activities," said Balserduring debate on Bill 78. In closing second reading debate later that same day, the minister noted the sometimes fickle nature of economic developmentdecision-making.

Balser said the business community wanted reassurance that any change in government would not trigger anew set of rules for those seeking government assistance.

But 22 years later, the Houston government,which includes Balser's daughter, Jill, as the Minister of Labour, Skills and Immigration, is retaking control of economic development by merging Nova Scotia Business Inc. and Innovacorp to create a new Crown corporation Invest Nova Scotia.

Unlike its predecessors, this new body will not operateat arm's-length of government, nor be run by an independent boardof directors.

Instead, Invest Nova Scotia will be managed and controlled by Susan Corkum-Greek, the current economic development minister, withhelp froman "advisory board." There will be a chief executive officer, but that person will report directly to the deputy minister of the department.

Premier explains why

Speaking to reporters Friday at Province House, Premier Tim Houston explainedthe change.

"The government is accountable for the spending of taxpayer money, so if we're going to be held accountable, then we need to have a system in place that we're comfortable with," said Houston.

Asked if the minister would be able to determine which companiesgetgovernment money, the premier said that was not the intention of the new structure.

Houston also said politics would play "zero" part in decision-making and that the changes were to reduce "passing the buck" between agencies and allowing a "one-stop shop" for all companies looking for government help.

'Growing pains'

One person sorry to see NSBIdissolved is Stephen Lund, who led the Crown corporation from 2001-13.

"NSBI survived four premiers, three changes of government," Lund said."That's quite a bit for an organization that's involved in something to do with economic development."

Lund said there were "growing pains" when NSBI started.

"It was difficult for companies because they had this mindset of going to a politician, but it was equally difficult for politicians to finally know that they can't make a phone call and get something done for a company in their riding," he said.

Lund was willing to give the Houston government the benefit of the doubt despite being "disappointed but not surprised" to hear about the changes.

"We had a lot of success," he said. "And we had talked to some of the top companies in the world and we were named at one point the top jurisdiction in North America for attracting business.

"Having said all that, it's 21 years. You know, maybe 21 years is enough for this type of a model."

Opposition weighs in

Liberal Leader Zach Churchill took a more partisan view.

"The concerns are that we're returning back to 1980s Tory politics where patronage appointments are happening with personal friends, partisans and other friendly people to the PC Party and that they get to control hundreds of millions of dollars of taxpayers' money that distributed for venture capital, innovation and research and trade," said Churchill.

"Listen, everything's political," he said. "Our concern would be if they're strictly partisan considerations to improve the state of affairs with the PC Party."

NDP Leader Claudia Chendercalled the change "very concerning."

"We have a concern that we're returning to an old school Nova Scotia politics where what matters most, in terms of your success, is who your friends are," said Chender.

She said having independent boards oversee incentive programs, grants and payroll rebates gave her more comfort than having politicians holding the purse strings.

"These are experts and I think we need to know that our innovation sector, our business sector [funds] are being shepherded in a non-partisan way and in an independent way."