Winnipeg Free Press - PRINT EDITION

'A debacle for the West'

Pagtakhan raises fears about Harper's economic development plans

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CONSERVATIVE Leader Stephen Harper says he wants to mend the Department of Western Economic Diversification, not end it.

But Rey Pagtakhan, the Liberal candidate in Winnipeg North who was minister of WED in Paul Martin's government, said Harper appears to favour changes that would create "a debacle for the West."

When questioned about his plans for WED and other regional development agencies, Harper's aides point to a speech he made June 2 to the Toronto Board of Trade.

"I will keep the regional development agencies, but focus them on developing sound policy ideas and help to create networking and marketing opportunities for regional businesses and encouraging the growth of innovation clusters," Harper said in the speech.

"But the regional development agencies will get out of the grants-and-subsidies game."

The Conservative leader's comments on WED and other subjects are drawing increased scrutiny as polling trends show a Conservative government more likely.

Harper said he wants to eliminate grants and other financial subsidies to businesses and replace them with a more favourable tax environment, through tax cuts or investment tax credits. The Conservative platform says regional development spending would focus on research and development, especially medical and scientific research.

Pagtakhan said that with rare exceptions, WED has already ended loans and grants to businesses, though it continues such payments to non-profit agencies.

But he said he's concerned Harper would apparently limit the role of regional development agencies such as WED to research and development.

"That is diametrically opposed to what we believe is an important tool, particularly here in Manitoba and Winnipeg," Pagtakhan said.

"That would be a debacle for the West."

The department supports entrepreneurship and creating sustainable communities, through developments such as a North Winnipeg Wellness Centre, Pagtakhan said. Those two areas likely would not fall under the umbrella of research and development, he said.

Pagtakhan questioned whether Harper would cancel the $50-million Canada-Manitoba Economic Partnership Agreement or the $75-million Winnipeg Development Agreement.

Vic Toews, the Conservative incumbent in Provencher, said it's ludicrous for Pagtakhan to suggest the region would suffer economically under a Harper government.

In addition to spending on research and development, the Conservatives would make long-delayed investments in infrastructure, he said.

"We will not support grants to commercial enterprises who should be having a level playing field and a fair tax system in which to compete," Toews said.

Toews noted Liberal MP Reg Alcock suggested WED was ineffective and should be abolished, shortly before he was named president of the Treasury Board.

Judy Wasylycia-Leis, the NDP candidate in Winnipeg North, said she's concerned about replacing regional financial subsidies with tax cuts. "There's no proof that improving tax benefits is necessarily going to improve opportunities in this province," she said.

Republished from the Winnipeg Free Press print edition June 22, 2004 $sourceSection$sourcePage

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