Feds fast-track $1B fund; Aid to help towns hit by economic downturns; keeps Ford hopes alive

PUBLICATION: The Windsor Star
DATE: 2008.02.05
EDITION: Final
SECTION: News
PAGE: A1 / FRONT
BYLINE: Sonja Puzic

Feds fast-track $1B fund; Aid to help towns hit by economic downturns; keeps Ford hopes alive

The minority Conservative government bowed Monday to opposition demands to fast- track a $1-billion federal aid package designed to help ailing industries and workers, which could help reopen the Ford Essex Engine Plant in Windsor.

The government will create a separate bill for the promised $1-billion community development trust fund to help towns and workers hard hit by economic downturns, instead of including the money in the next federal budget.

Prime Minister Stephen Harper first announced the aid package for unemployed workers and single-industry communities in early January and tied it to the federal budget, expected by early March.

Opposition MPs and provincial premiers -- led by premiers Jean Charest of Quebec and Dalton McGuinty of Ontario -- had denounced Harper's plan to link the money to the budget as blackmail.

They accused the federal government of holding hard-pressed workers hostage to the minority government and a possible election.

The House of Commons is likely to vote on the new legislation this week.

MP Jeff Watson (C -- Essex) said Monday the distribution of relief funds will depend on agreements the provinces and territories have to sign with the federal government.

"If all the provinces and territories will sign their agreements -- and in Ontario, that is not the case yet -- we're prepared to, first of all, initiate a stand-alone act to implement the community development trust fund and, secondly, seek the unanimous consent of all parties to move that forward quickly," he said.

Watson said Ontario stands to receive about $350 million from the federal aid package. Premier Dalton McGuinty will have to outline the province's priorities and decide whether some of that money will go to Ford to help bring proposed assembly of a new fuel-efficient V-8 engine to the recently idled Essex Engine Plant, Watson said.

The provincial government has already agreed to contribute $30 million to the project, but Ottawa has resisted providing a subsidy to Ford, saying it would not fund specific corporations.

"What we've heard from the industry and everyone is that time is of the essence in getting help to communities who are in real need and that's what's motivating this government to move forward," Watson said. "We're still waiting for our provincial counterparts to do their parts and Mr. McGuinty in Ontario needs to first conclude a deal with us.

Plant reopening

"For those of us in Windsor, we'll ultimately be looking at whether that deal will include allotting some of the federal dollars ... to the Essex Engine (Plant) reopening."

Ontario's economic development minister, MPP Sandra Pupatello (L --Windsor West) said although she received little information about the proposed legislation Monday, she's concerned that there won't be enough money to help Canada's struggling auto industry, since financial aid to forestry towns is being discussed in the relief package as well.

"When you start whittling away at the details, it's very little (money)," she said.

Pupatello said the Conservatives' decision to fast-track the $1-billion aid package is "political" and ignores the province's calls for an auto fund. Still, she said she's hopeful that the Essex Engine plant can be saved.

MP Brian Masse (NDP -- Windsor West) said he looks forward to the bill, which may be tabled today, and hopes it will give "more flexibility" to Ford.

"Everybody up here in Ottawa, for the most part, recognizes that there are industries that are being pummelled by the rapid escalation of the Canadian dollar," he said. "Sectors can't adjust properly in this environment and something has to be done. Other countries are doing it."

The government move adds a new twist to the political calculations on the hill. It means the opposition parties can vote against the budget, and not be blamed for killing the $1-billion relief package. It also means that if the government is defeated, it can hit the campaign trail bragging that it had sped up the assistance.

Under the funding formula, each province will be allocated an initial $10 million, and each territory will get $3 million. The balance of the funding will be allocated on a per capita basis.