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Province axes Economic Development Ministry, replaced by ‘leaner’ Business Department


HALIFAX – In her second budget tabled April 9, Nova Scotia Finance Minister Diana Whalen announced the end for the Department of Economic Development and Tourism, which, she admitted, has not been successful in stimulating economic growth in the province.

In her second budget, tabled Thursday, Nova Scotia Finance Minister Diana Whalen announced the end for the Department of Economic Development and Tourism, which, she admitted, has not been successful in stimulating economic growth in the province.

“The department had a lot of grant-giving programs, and the results were clear: we weren’t getting a stronger economy,” said Whalen. Nova Scotia has consistently received failing grades in economic development from the Conference Board of Canada.

A new, “lean” Ministry of Business, led by Minister Mark Furey, will take its place, and focus on industries that have significant potential, such as aquaculture. Furey will continue to oversee his current portfolios of Municipal Affairs and Service Nova Scotia.

Rather than providing business with direct support in the form of grants and subsidies, the Department of Business will focus on creating the conditions for economic growth, said acting deputy minister Bernie Miller.

Rob Batherson, Incoming Chair of the Halifax Chamber of Commerce said this new ministry is a step in the right direction, and that he supports all efforts for government to better control spending.

“There’s no win in continuing to provide programs and services on borrowed money,” said Batherson. “The economic turnaround in the province will depend on the private sector, and it has to be led by the private sector.

Batherson said the Chamber applauds the province’s commitment to reduce red tape and implement a “common sense” regulatory environment.

“If it’s successful, it will help to create wealth and jobs and that will be a good thing.”

The Department of Business will house the recently announced Office of Regulatory and Service Effectiveness, which will implement the regulatory recommendations in the Nova Scotia Tax and Regulatory Review and work with New Brunswick to create a streamlined regulatory environment between the provinces. At the top of the agenda is the consolidation of the inspection, compliance and enforcement functions of the departments of Natural Resources, Agriculture, Fisheries and Aquaculture, Environment and the public health inspectors from Health and Wellness into a new division with the Department of Environment.

The Department of Business will have a staff of approximately 28 and an operating budget of $56.6 million, representing a savings of $29 million this year alone.

The government is also closing a “loophole” in the small business tax credit, reducing the non-eligible dividend tax credit from 5.8 percent to 3.5 percent, which means incorporated small businesses will pay an additional $30 million in taxes this year.

Whalen’s $10-billion budget includes an estimated $98-million deficit along with changes to the film industry tax credit, departmental restructuring and the elimination of 320 full-time equivalent government positions.

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