Editorial A good basis for investment

Remember Erik Nielsen? His was a long career as the Progressive Conservative member for the Yukon, but perhaps his greatest legacy was an ambitious review of all federal funding programs, even though his task force report has remained on the shelf since it was tabled in the House of Commons three years ago.

But one of the recommendations in his report that was heeded focused on the federal government’s mineral development agreements with various provinces and territories.

The MDAs, as the agreements are called, could be a powerful and flexible tool for co-ordinating federal and provincial activities, providing they were “directed toward economic potential in the private sector.” In other words, news you could use, not data that doesn’t matter.

Since then, a system of industry advisory forums has evolved in each of the nine provinces and territories that have established MDAs to help select, plan and execute projects that would qualify for funding. There has even been a trend toward cost sharing with industry on some projects that might otherwise not have gone ahead and, according to a committee of provincial geolgists, industry representatives have commented several times on their ability, through the MDAs, to access superior expertise and facilities which might not otherwise have been available.

But this bias toward industry is just one aspect of a federal program that is little known but of much benefit. In general, since its inception in 1984, it has been a program that works.

The funding — about $250 million from both levels of government between 1984 and 1986 — is largely for the collection and distribution of information that can be used toward finding new mineral deposits, developing new exploration techniques and technologies and conducting research into new uses for minerals and metals. Geoscientific surveys, research and development into mining and mineral processing technology, marketing and economic studies are some of the areas into which funding is being channeled.

As the provincial geologists point out: “Many parts of the country owe much of their current economic activity to mining and mineral processing. Indeed, throughout much of Canada, mineral production constitutes the only viable economic activity capable of sustaining the current infrastructure and affirming a territorial presence.” All areas of Canada benefit from these MDAs. This is not a case of “them that has, gets.” The results of the projects undertaken by these agreements will help form the basis of exploration and development for years to come. This body of knowledge, generated over the years partly by such academic research and partly by the efforts of industry — including individual prospectors — is the foundation upon which future investment by the private sector in exploration and development may rest.

Canadian ore reserves are dwindling (N.M., June 13 /88), but these MDAs are one means of arresting that decline. Subsidies to mining companies for capital investment or for exploration are not the answer to improving Canada’s competitive position. The private sector has to deal on its own with those decisions if it wants to steer clear of government handouts. Accepting them can quickly become a habit and eventually an addiction. But government assisted research to provide a data base of academic information that can be used by any potential investor, big or small, Canadian or foreign, is a good means of facilitating more, and more cost- effective, exploration and development.