Budget 2014 Advances the Fishery and Economic Development in Rural Areas

Generating economic activity in rural communities continues to be a priority for the Provincial Government, as reflected in Budget 2014 initiatives that enhance fishing and aquaculture activity, support small business, promote tourism, advance the forestry and agriculture sectors, and strengthen rural infrastructure and access to broadband.

“Rural communities throughout Newfoundland and Labrador play a key role in the success of many of the province’s renewable, traditional industries. This government is making strategic investments to ensure these industries thrive and create meaningful employment in rural areas. The Provincial Government has made significant gains for the fishery through free trade agreements, industry collaboration, and strategic investment. Budget 2014 continues that approach with more than $20 million to enhance the industry’s capacity to compete globally and take advantage of new opportunities in international markets.”
- The Honourable Keith Hutchings, Minister of Fisheries and Aquaculture

Positioning the Seafood Sector for Unprecedented Success
Budget 2014 commits more than $20 million to help Newfoundland and Labrador’s fishing and aquaculture industries prepare for the new economic opportunities that will be created by the Comprehensive Economic Trade Agreement between Canada and the European Union, as well as other trade agreements that have been completed or are in process.

An investment of $9.7 million will support industry enhancements and planning initiatives, including:

• $4 million for the Fisheries Technology and New Opportunities Program for the next two years to further support research and development into enhanced harvesting, processing, and marketing techniques;
• $2 million to renew funding for the Canadian Centre for Fisheries Innovation over the next two years to ensure industry stakeholders can avail of the centre’s expertise and resources when pursuing innovations that build competitive advantage;
• $2.5 million to continue the Fish Plant Worker Support Program for three more years;
• $400,000 over the next two years to support enhanced marketing initiatives; and,
• $800,000 over two years to build capacity for planning and development activities. Significant work will take place in 2014 with respect to making decisions about how the recently announced $400 million Federal-Provincial Fisheries Fund will be allocated. This funding will be used to hire dedicated staff to work with industry and the Federal Government to prepare for new international trade opportunities.

A total of $6 million has been allocated to the Aquaculture Capital Equity Investment Program in Budget 2014 to support the further development of new aquaculture operations, which in turn will stimulate the economy in rural areas. Between 2006 and 2013 the Provincial Government invested approximately $25 million to support aquaculture development, which leveraged approximately $400 million from the private sector. The success of the industry is reflected in the approximately 1,000 jobs it supports, and in the way it has revitalized the economy on parts of the south coast of the island in particular.

In addition, the Provincial Government will strengthen its commitment to fisheries science in 2014 with an allocation of $4.9 million over two years to support the Centre for Fisheries Ecosystems Research. Newfoundland and Labrador continues to be the only province in Canada solely funding its own fisheries research. This funding builds on the $13 million the Provincial Government has invested since 2010 to support research activity.

“This government is investing in Newfoundland and Labrador’s fishing and aquaculture sectors because they are key drivers of the provincial economy, having generated approximately $1.1 billion in production value in 2013. Tourism, forestry, and agriculture are further examples of industries that are vital to rural communities and drive the province’s nation-leading economy. Budget 2014 fosters new development in these industries, and builds infrastructure that supports long-term success.”
- Minister Hutchings

Assisting Small Businesses
Small businesses are an important part of the economy in rural Newfoundland and Labrador, creating jobs and opportunities and strengthening communities. To further strengthen a competitive tax environment for small businesses in the province, effective July 1, 2014, the Provincial Government will decrease the small business corporate income tax rate to three per cent, and will be tied with Nova Scotia for the lowest rate in Atlantic Canada.

Supporting the Tourism Industry
Budget 2014 will provide an additional $2 million to support tourism marketing in the province, with an additional $2 million in 2015-16, bringing the total annual investment to $13 million by 2015-16. Investment in tourism is vital to economic growth, as there are more than 2,500 tourism and travel businesses in the province, of which 83 per cent are small businesses, and 87 per cent are located outside the St. John's area.

Fostering the Forestry and Agriculture Industries
Budget 2014 is committed to Newfoundland and Labrador’s rural communities with strategic investments in the province’s forestry, agriculture, and agrifoods sectors that support a prosperous future for the people of the province. The province’s forest industry employs 5,500 people, mainly in rural areas, through direct and indirect employment and is valued at $250 million annually. To support a diversified and sustainable forest industry, Budget 2014 will provide $20 million for silviculture projects, forest insect and disease control, fire suppression, road construction, and research initiatives.

The province’s agriculture industry is another significant contributor to the economy of rural Newfoundland and Labrador with sales valued at $500 million a year in both production and secondary processing, providing direct and indirect employment for 6,500 people, mainly in rural Newfoundland and Labrador. Budget 2014 will provide close to $12 million for programs that will further grow the industry including Growing Forward 2, the Agriculture and Agrifoods Development Fund, Provincial Agrifoods Assistance Program, Land Consolidation Program, Agriculture Research Initiative, and Agricultural Limestone Program.

Advancing Innovation and Access to Broadband
Newfoundland and Labrador’s business and economic environment is being driven by innovation, growth in traditional and emerging industries, and strategic investments. Budget 2014 will invest $45.5 million to support business sectors and regional economic development initiatives throughout Newfoundland and Labrador. Since 2005, approximately $125 million, or 64 per cent of available funding has been invested in rural parts of the province to advance business and regional development, and support growth and diversification.

The Provincial Government’s plan to extend rural broadband access has led to more than 500 communities in Newfoundland and Labrador, and approximately 95 per cent of the population having broadband access. In 2014, $4.9 million will be invested to further improve broadband access in the province, working with industry and community partners to build on past successes and improve access to high speed Internet.

Enhancing Key Infrastructure to Support Economic Growth
The Provincial Government has made significant investments in infrastructure in rural Newfoundland and Labrador to build strong communities for families. To continue this important work, Budget 2014 allocates approximately $100 million in municipal capital works over the next three years for key projects in rural parts of the province such as drinking water systems, wastewater systems and road work.

Through Budget 2014, the Provincial Government is allocating $852.7 million in infrastructure and transportation, which includes a heavy focus on rural communities. Construction of new public facilities such as schools and hospitals, which is happening in rural communities throughout Newfoundland and Labrador, is providing jobs and supporting economic activity.

The Provincial Government also remains focused on the development of marine infrastructure and roads, as well as enhancements to tourism and municipal infrastructure. These projects provide small businesses with added opportunities to grow and diversify their operations.

Additional details can be found in News Release: Investing Over $1 Billion to Support Economic Growth for the People, Families and Businesses of the Province, and Backgrounder: Enhancements to Tax Programs to Benefit Seniors, Low Income, and Small Business.

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2014 03 27                                  2:30 p.m.