Wednesday, March 09, 2005

BC missed great chance to create pine beetle fund

VICTORIA - The B.C. government had a great opportunity to help communities facing hard times because of the pine beetle infestation.
But it let the big chance slip away.
The Liberals’ pre-election budget did have some significant measures to help deal with the problem over the next few years.
But there was an extraordinary chance to do something much more significant, and lasting. As the Liberals put together the budget, they realized the province was on track to a surplus that could top $2.8 billion in the current fiscal year.
That’s a huge pool of money. Some of the surplus is the result of one-time factors, so care had to be taken in avoiding spending commitments that might not be supportable in the future.
But the opportunity for one-time investments was enormous, in health care, economic development - or a program to help forest communities cope with the coming crisis.
Instead, the government opted to use more than 80 per cent of the money to pay down the debt. About $2.3 billion will go off to the lenders; $450 million will go to meeting today’s needs in the province.
The forest ministry got $112 million extra out of the surplus. But $50 million of that, already announced, will go to help contractors and workers hurt by the province’s industry restructuring plan and tenure takebacks. Another $50 million will go to the big forest companies, because it’s costing more to compensate them than expected. That leaves $12 million for enhanced reforestation.
There’s another $89 million for reforestation in the plans for the next three years.
That’s all welcome.
But what a missed chance to take some of that surplus - say $300 million - and set up a special fund to provide targeted aid to those communities.
Everyone agrees that forest communites across the province will face tremendous challenges. The pine beetles are killing trees today, but that’s not having any significant negative economic impact. The trees still retain their commercial value for five to 10 years.
But in about 15 years, those treees - 80 per cent of the lodgepole pine in the province - will be dead and worthless. The next generation of trees, even with aggressive reforestation, won’t be ready for harvest for 20 more years. Communities will see the annual allowable cut reduced by up to 40 per cent for decades. Mills will close, jobs will be lost, and the face of communities will change.
Take the Quesnel area. The timber supply is expected to be cut by almost one-third. About three-quarters of the 12,000 jobs in the area are tied to the forest industry, which means more than 2,500 jobs will vanish. That's the equivalent of 300,000 lost jobs in the Lower Mainland.
There is other money in the budget which will help the communities. Mining and tourism get more support, and there are transportation and other infrastructure programs.
But those are province-wide programs. They don’t target communities facing the specific problems caused by the pine beetle infestation.
There are no easy answers. Even the current challenge of getting the wood harvested before it loses its value is proving difficult.
But both the Liberals and the NDP have agreed that a legacy or development fund would help communities prepare for the coming crisis. They could improve infrastructure, offer retraining or promote tourism. And they could establish just how bad the situation will be, to allow proper planning by families, and by communities.
There’s still a chance for the legacy fund. But this year’s big surplus offered a great opportunity to providep money for the communities that will be affected. Instead, 80 per cent of the surplus went to paying down the debt, a response out of step with the priorities of most British Columbians.
The government had the chance to take a balanced approach, paying down debt and supporting forest communities facing the pine beetle crisis.
It missed an opportunity.
Footnote: One reason the province hesitated is that it wants a significant contribution from the federal government, and feared that Ottawa would back aay if B.C. seemed to be handling the problem on its own. The federal budget didn’t include any pine beetle funding. Industry Minister David Emerson, ex-Canfor CEO, has the federal responsibility.

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