EDITORIAL PAGE — Whitehorse Initiative puts ball in

It is easy for the mining industry to be cynical about government’s willingness to take action to protect its future in Canada. And it is probably easy for environmentalists and labor groups to be cynical about the industry’s commitment to be progressive on issues affecting them. Indeed, the notion that all these parties could join forces in an attempt to help resolve this country’s economic problems is probably too far-fetched for most of us to imagine.

Well, times must be a-changing. For the past two years, industry, government, environmentalists, labor and aboriginal groups have worked to address some of the most challenging mining issues. And something concrete has come from the process — the signing of the Whitehorse Mining Initiative (WMI) Leadership Accord at the recent Mines Ministers’ Conference in Victoria, B.C.

Louis Gignac, chairman of the Mining Association of Canada (MAC), says the accord “provides a new strategic vision for the future of our industry and the 150 Canadian communities that depend on mining for jobs and their economic prosperity.” Specifically, it calls for immediate government action in two areas, mineral exploration incentives and tax policy with respect to mine reclamation. Both are needed to help stop the flow of international investment away from Canada and towards Latin America and other parts of the world.

But the WMI goes farther than that, based on the premise that industry cannot ask for government to take action without taking action of its own. To demonstrate leadership, the industry has committed itself to launching an Environmental Management Initiative. This will include the updating of MAC’s Environmental Policy, as well as a process to set up guidelines to advance protection of the environment throughout exploration, mining, processing, manufacturing and closure activities.

The industry is also committed to the Mining Sector Human Resources Council. The council is being formed under the co-sponsorship of MAC and the United Steelworkers of America. A first meeting was held in an attempt to establish skills-upgrading programs to ensure the competitiveness of Canada’s mining employees.

It is the role of government to take action on policies essential to the future of industry, and, with regard to the WMI, the ball is clearly now in its court. Ottawa’s first priority should be to implement one of two proposals endorsed to revitalize exploration in Canada, the restoration of a modified Mineral Exploration Depletion Allowance or, alternatively, tax changes that would qualify mineral exploration expenditures for a research and development tax credit.

Governments also need to change tax laws on mine reclamation funding. Some recent changes were made to allow deductibility into mandated reclamation funds. However, industry is advocating further changes to allow tax on the earnings in these funds to be deferred until they are withdrawn for reclamation work. MAC believes these changes would promote environmental stewardship while enhancing investment and job creation.

The accord opens the door to action to ensure the future of an industry that has contributed much to Canada’s economic well-being. However, we agree with MAC’s assessment that the success of the initiative will be judged “not by words and accords, but by action to keep mining in Canada.” Our loss would be Latin America’s gain.