-- CTF releases landmark study on $11billion of Industry Canada Assistance --

OTTAWA: At a news conference this morning in Ottawa, the Canadian Taxpayers Federation (CTF) released a study of sixteen years of financial assistance authorized by Industry Canada to individuals, other levels of government and corporations. The study is entitled Corporate Welfare: A Report on Sixteen Years of Industry Canada Financial Assistance. The information was compiled through six months of Access to Information requests.

"This study is definitive, damaging and depressing" noted CTF Federal Director, Walter Robinson. "It is definitive in its scope, damaging in highlighting horrendous repayment records for most programs, and depressing because this situation has been tolerated for so long."

Main findings:

• Over $11 billion of assistance was authorized over the past 16 years through 32,969 separate grants, contributions , loans, interest contributions and loan guarantees;
  
• Over 18% of the $11 billion ($2.1 billion) was authorized through various forms of assistance to five companies:
  
  • Pratt & Whitney -- $949 million
    
  • De Havilland -- $425 million
    
  • Bombardier/Canadair -- $245 million
    
  • Le Groupe MIL Inc. -- $241 million
    
  • Air Ontario -- $224 million
  
  
• Over 49% of the $11 billion ($5.6 billion) was authorized to 75 of some of Canada's largest and most profitable companies;
  
• A mere 8% of $2.6 billion lent out to recipients through the now-defunct Defence Industry Productivity Program (DIPP) has been repaid;
  
• Some recipients of DIPP funding continue to receive funding from a similar program, Technology Partnerships Canada;
  
• Only 15% of fully repayable loans and conditionally repayable loans totalling in excess of $3.2 billion across 28 separate departmental programs have been repaid to date.

"We personally delivered this study to the office of Industry Minister John Manley this morning. If he didn't know about the magnitude of the situation - he does now," stated Robinson.

"This report is only the tip of the iceberg. It excludes the billions handed out over the years through regional development programs such as Western Economic Diversification (WED), the Atlantic Canada Opportunities Agency (ACOA), and the Federal Office of Regional Development for the Province of Quebec," added CTF-Ontario Director, Brian Kelcey, who joined Mr. Robinson at the news conference.

"This study builds on the work that started last August when the CTF revealed that over $200 million was lost through defaults to the Small Business Loans program from 1992 to 1996," stated Robinson adding "that reductions in Industry Canada spending are a key ingredient to lowering taxes and spurring economic growth."

As a result of this study the CTF has made the following recommendations.

CTF Recommendations

1. An immediate cessation of the Technology Partnerships Canada program and an immediate end to all conditionally repayable contributions through the Department;
   
2. A full investigation by the Industry Minister of all departmental activity in recovering loaned monies;
   
3. A challenge to the opposition parties and/or government backbenchers to champion legislation that will put an end to discretionary government financing of business ventures similar to that of Alberta's Business Financial Assistance Limitation Statute.

CTF Actions

1. An offer to meet with the Industry Minister to discuss the report in detail and provide him with other supporting documentation.
   
2. A national petition campaign advocating the implementation of a law to end discretionary government funding of business ventures.

"We believe that with the release of today's study, the beginning of the end of corporate welfare has begun," concluded Robinson.


Note to editors:
Authorizations do not necessarily equate to expenditures, however, this study reveals that, as an average, 79% of authorized amounts were actually expended.