November 13, 2013
Canadian governments must do a better job coordinating how they collectively spend $20 billion each year on economic development strategies, says a new report released by the Mowat Centre today.
TORONTO—Canadian governments must do a better job coordinating how they collectively spend $20 billion each year on economic development strategies, says a new report released by the Mowat Centre today.
According to Let’s Talk: Coordinating Economic Development Spending in Canada, efforts by various levels of government to support economic growth aren’t designed to work together. The report notes that governments at all levels in Canada have rightly produced many programs and policies to spur innovation and enhance productivity; and points out that taken together, money spent on these important programs amounts to a significant investment of roughly 20 billion dollars per year.
But, the report shows that for the most part economic development programs across Canada are being undertaken in isolation, with no formal efforts to develop a coherent strategy to spur growth.
“Constitutionally, Federal and provincial governments share responsibility for economic development,” said Sunil Johal Mowat’s Policy Director and one of the report’s co-authors. “But that doesn’t mean their efforts have to be unconnected.”
The report recommends looking at many existing inter-governmental collaborations as a model for economic development strategies. Government approaches on infrastructure, health care and skills training offer lessons could offer lessons for how to approach Canada’s innovation and economic growth challenges. The models all share key features: governments have a forum for dialogue, agreement on key priorities and cost-sharing.
“Adopting a similar model in the economic development arena would help Canadians get much more out of their annual $20 billion investment,” Mowat Researcher and co-author Noah Zon said. “That means more competitive firms, higher-quality jobs and stronger productivity growth.”
According to Zon, the discipline that comes with coordination will force each government to clarify their own program objectives and measure their results. A good start could include hammering out bi-lateral agreements that clearly establish common priorities and assess what programs and policies are best suited to achieve collective strategic goals.
“In lean times, when every government faces having to do more with less, there couldn’t be more reason for federal and provincial governments to direct their finance and economic development ministers to sit down and talk to each other about how best to coordinate economic development,” Johal said.
“At the end of the day, there may be no guarantee that a coordinated intergovernmental approach would produce better outcomes,” he said. “But, we couldn’t possibly do worse than the status quo with different levels of government each planning, funding and implementing economic development programs in silos.
