“You’re richer than you think” Scotiabank used to say in its marketing campaign to prospective customers. Today we learned the Province is in better financial shape than we were led to believe a year ago.
Audited financial statements for the year March 2018–March 2019 show the province had a surplus of $120 million, four times higher than the estimate of $29 million. Finance Minister Karen Casey told journalists the biggest reason behind the new-and-improved financial results was that the government had over-estimated the pension payments amount employees in long-term care would receive under a new formula related to retirements.
Those lump sum pension payments to workers in health care cost the McNeil government $72 million less than it expected. Continuing low interest rates also saved the government $39 million in debt servicing charges. The province’s net debt now stands at $15 billion dollars and the debt-to-GDP ratio dropped a full point to 34.1 percent, the lowest in five years. Casey made note of other positive economic indicators including a growing provincial population and youth unemployment dropping below 10 percent for the first time in a decade.
The financial statements contained a couple of nasty surprises. The list of “additional appropriations” to the 2018-19 budget contained $48 million booked or recorded to clean up two abandoned gold mine sites. Apparently there are more than 60 abandoned mines around the province (mostly coal and gold) but these two — at Montague Mines in Dartmouth and Goldenville in Guysborough County — are “the most egregious” according to Lands and Forestry Minister Iain Rankin.
Rankin says both sites involve contaminants such as mercury and arsenic that could pose a risk of leaching into the water table and nearby communities. For that reason, they will be cleaned up although no timeline has yet been established. Here is a list of other sites Lands & Forestry is tasked with examining to see what if any action may be necessary.
Rankin says most of these sites are more than 50 years old and legislation back-in-the-day failed to protect today’s taxpayers from shouldering the costs to clean up the mess left behind by private mining companies.
Asked why the province should even consider allowing new gold mines to set up on Crown land as proposed by companies such as Atlantic Gold, Rankin defended the current regulatory regime as adequate to prevent a repeat of the past.
“Today companies have to put forward a plan for reclamation,” said the Lands and Forestry minister responsible for Crown land. “They put up the surety for it. We ensure the onus is on that private company to make that remediation plan and pay for it.”
NDP leader Gary Burrill disagrees.
“These proposed cleanups underline the point we in the NDP have been making about gold mine proposals in Sherbrooke and for Warwick Mountain,” said Burrill. “When you have (as we do in Nova Scotia) an inadequate environmental assessment system, you are in danger of the public having to pay a great deal of money years down the road. I think we could have a great deal more assurance if the level of that surety was established by an independent third party. The fact that the surety is established through negotiations between the government and the mining company doesn’t give me that assurance at all.”
Abandoned mines weren’t the only areas where the provincial treasury was called upon to cough up more money to make a problem go away. There was $35.4 million added to clean Boat Harbour, the effluent treatment facility used by Northern Pulp in Pictou County, still scheduled to close at the end of January next year. Finance Minister Casey was unable to provide a new estimate for the remediation or total cleanup but trotted out an old figure of $230-million.
The appropriations list also included $13.1 million for the Yarmouth ferry — $8.5 million for ongoing renovations to the Bar Harbor, Maine terminal; $1.4 million to move Customs and border equipment from Portland, Maine; $1.3 million for a gear box replacement on the boat; and $1.9 million to cover increased fuel costs and lower revenues. This additional funding topped up $10.9 million that was in the original budget for the ferry service that ran last summer (2018) for a total of $24 million.
Amazingly, Transportation Minister Lloyd Hines remains both confident and hopeful The Cat will sail this season. The Minister says it’s “possible” the season could be extended into October if the boat gets on the water. The timing of that is totally in the hands of the US Customs and Border Patrol. The minister said the US Service has rules regarding how much physical space it requires to conduct its affairs, and the footprint or design of the Bar Harbor terminal falls somewhat short in that regard.
Negotiations between Bay Ferries and the US Border Service (with the assistance of hired gun and former Ambassador David Wilkins) are continuing to try and achieve “compliance.”
It is a story worth watching. The budgeted operating subsidy for the ferry is $13.8 million for this year. The department says it is unable to respond to a request for an estimate as to how much the province would save if The Cat does not operate this summer. The department says there are too many variables.
The management fee paid to Bay Ferries is not one of them. That gets paid whether the ship sails or not. It’s in the contract with the province which appears to include few, if any, performance standards.
Gary Burrill makes a good point about reclamation costs but Moose River may already be a done deal. Nova Scotians need to wake up and ensure that this gold fever goes no further.