Editorial The flow-through lever

In fairness, Epp has only held the post for six weeks. Nevertheless, his appearance at the convention was his first speech to a major mining audience since his appointment and, as such, it was a golden opportunity to end the atmosphere of uncertainty that has enveloped the industry since early in 1988. Instead, he seemed to be preparing the industry for some tough times ahead.

To be sure, Epp emphasized that this Tory government plans to provide “appropriate support without doing industry’s business” and a “stable policy environment with, hopefully, no major surprises.” He also paid tribute to the industry’s contribution to national wealth and regional development.

But in making those remarks, his grasp of statistics seemed tenuous at best, merely a recitation of numbers provided by his staff. And, what was more discouraging were his ominous remarks about “budgetary pressures” limiting the “financial levers” his government can manipulate, about mining being the only financially assisted sector of the private economy, and about the need for government and industry to “do a better selling job” on the new Canadian Exploration Incentive Program.

Whether it be CEIP or some other incentive, flow-through shares are one such government-controlled lever and it is certainly within the government’s power to do away with the mechanism altogether. But Epp might consider travelling to La Ronge, Yellowknife, Val d’Or, Bathurst, St. John’s and Wawa, during his next few months on the job and instead of relying on statistics to tell the story, see how those communities have benefited from increased mineral exploration activity. Then he might consider which federal programs are really the most cost-effective: incentive’s for an industry that creates wealth or social programs that will certainly have to come into effect should mining be squeezed out.

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