Be wary of ‘independent’ evaluations of government policies
Posted October 25, 2024
Organizations dependant on government support often produce documents highlighting the economic and other benefits that they provide. Like many commercial sales pitches, they feature the strong points and slip past the potential problems.
The most egregious example comes from the film industry. After the eighth and final season of “Mister D” they announced that it had created 1,425 jobs. They failed to mention that they were counting the same 178 seasonal jobs in each of the eight years.
Nor did they adjust for the fact that the jobs lasted for at most two months, which makes the 178 equivalent to 30 year-round jobs. For this, the government subsidy was $1.36 million for the eighth year and comparable amounts in the preceding seven. And of course, all of those jobs have disappeared.
Sometimes an organization retains an outside firm to make their case. It creates the veneer that the message comes an independent expert. Thus, the Association of Atlantic Universities (AAU) retained Gardner Penfold to calculate the economic impact of the government constraints on their number of international students.
The result of the new government policy was a reduction of 2,983 full-time visa students. Gardner Penfold estimates that this will have a direct negative economic impact of $163 million, or about $55,000 per student.
This might be true for the minority of students paying university tuition plus rooms in residences and meal plans. In practice many of the visa students are in their twenties. They pack themselves into off-campus housing where they share accommodations and cook their own food.
Cape Breton University has been the most significant destination for visa students. CBU accounts for full-time visa student reductions from 6,939 to 5,764.
That was going to happen regardless of government intervention. CBU has set a goal of reducing total enrolment to 7,000, with visa students representing no more than 60%, which would be 4,200. More intentional reductions at CBU are anticipated.
An even more regrettable use of external firms is the Houston government’s commissioning 21FSP, a consulting firm, to provide yet another study of the Yarmouth Ferry. Announced a year ago, the timetable was to have the report arrive sometime in the fall of 2025.
A possible interpretation was that the report would arrive after the election scheduled for next July, during which the ferry will be a hot political topic. This would enable a fact-based response to the data, but that was not the agenda. Instead 21FSP appears to have been chosen as the best advocate for a decision that had already been made.
Liberal leader Zach Churchill is the MLA for Yarmouth and is not interested in a reasoned evaluation of the facts.
Apparently, the same is true of Houston. He wants to avoid being attacked by Churchill during an election campaign for planning a rational decision about the ferry. On October 15, Public Works Minister Kim Masland announced that the ferry would be continued for another two years.
During that interval they will seek a replacement for the CAT. It is awkward and expensive to rent a ferry owned and crewed by the American Navy.
Minister Masland also released a “progress” report from 21FSP. Running to 33 pages, one might wonder if there is any thing left to be said.
In fact, some important things deserve mention but do not appear in the progress report.
The ferry brought 17,000 visitors to Nova Scotia in 2023. The province subsidized it to the tune of $21 million. That amounts to $1,235 per person, $6,175 for a family of five.
The ferry accounts for more than half of the visitors to Yarmouth. It accounts for 0.8% of the visitors to Nova Scotia.
If there was no ferry it would be a serious blow to Yarmouth and the surrounding area. The province should seek more cost-effective investments to support the region.
Meanwhile the hotels and restaurants in Halifax or Antigonish or Sydney will barely notice. Amherst and Truro might see more cars coming through New Brunswick. Digby would see an increase in ferry traffic from St. John. Fewer Nova Scotians would leave the province to visit New England.
Whenever it happens, they should subsequently seek ways to help Yarmouth get more self-sustaining jobs.
Sooner or later we are going to have a provincial election. Houston is destined to win big. His argument that he needs to accelerate the timing to get leverage in Ottawa is nonsense. Ask premiers Danille Smith and Scott Moe.
When candidates knock on the door, each of us can do a service by quizzing candidates of all parties about this kind of spending.
Related Articles
Chasing the Jobs- When Will Our Politicians Be Honest About The Economics Of The Yarmouth Ferry? August 18, 2023
- Let The Owls Head Proponents Make Their Case March 19, 2021
- First Nations Fishing Rights Are Best Realized Through Cooperation, Not Conflict November 6, 2020