Editorial: Quebec pushes forward with revived Plan Nord

More meat has been added to the bones of Quebec Premier Philippe Couillard’s revival of former Premier Jean Charest’s shelved Plan Nord to develop large infrastructure in Quebec’s resource-rich Far North.

The Couillard government tabled its budget on March 26 for the fiscal year starting April 1, 2015, and it contains specific funds earmarked for Plan Nord as well as overall budgetary encouragement of mining and mineral exploration in Quebec.

Premier Couillard assumed office in April 2014, and made his mark in mining circles by reversing the decision of the previous Parti Québécois administration — which came to power in September 2012 — to scuttle Charest’s Plan Nord from 2011, which envisaged $80 billion in government and industry investments in northern Quebec resource development by 2036.

Right away the new Couillard government announced it would invest directly in the equity of mining and oil and gas companies; extend and repair roads in the North; and revive a feasibility study to extend a Labrador Trough rail line to complement the two railways that connect the deep-sea port at Sept-Îles to the iron ore mines to the north.

The next big step forward came last September, when the Couillard government tabled Bill 11 to create the Société du Plan Nord (SPN) —  a government-supported organization that would have considerable power to encourage and coordinate Plan Nord activities.

The SPN began operations on schedule on April 1, after having convened its first meeting in late March. Élizabeth Blais of Sept-Îles is SPN’s first president, and Robert Sauvé is associate secretary.

The SPN is being funded by the province’s new Fonds du Plan Nord over a 25-year period, mostly by an annual endowment stemming from tax spinoffs relating to resource development in the Plan Nord territory, which covers 72% of Quebec.

According to the newly tabled budget, these spinoffs may total $77 million this current fiscal year, plus Hydro-Québec will chip in $10 million annually for the first five years. The sums really add up: over the 25-year horizon of Plan Nord, these tax spinoffs directed to the SPN could total $2.2 billion, according to current budgeting.

The budget also added $3 million per year over the next three years to an $8-million-per-year program to study the bedrock of the Plan Nord territory.

Next on the order of business for the SPN is to create an action plan for the next five fiscal years that will give everyone a better idea of the provincial government’s priorities.

In a major press conference in Montreal on April 8, Premier Couillard, flanked by much of his cabinet, unveiled more details of his government’s Plan Nord strategy, with the province now expected to spend $1.3 billion over the next five years to develop northern infrastructure and related northern projects. This would be part of an envisaged $50 million in government and industry expenditures over the next 25 years — down from Charest’s $80-billion figure.

The dramatic downturn over the past year in iron ore prices and the resulting agony among mine operators and developers in the Labrador Trough has cast a new light on the Plan Nord initiative, with Quebec government planners reining in their investment and tax projections, while extolling the Keynesian virtues of having the government invest in mining-related infrastructure during a downturn in the notoriously cyclical industry.

Apart from the smaller, $50-billion headline number, Couillard said during his presentation that the main difference between the old and new Plan Nords is that the new one will have a slightly different focus.

“I would say that the emphasis put on the notion of sustainable development, although it was put on the first plan as well, is more visible,” Couillard said. “We’re putting a lot of attention on the people who live there, and have been living there for centuries before us.”