It's The Economy, Stupid

Rob Linke
Telegraph-Journal
As published on page A2 on October 27, 2006

OTTAWA – Building better links with cities is proving to be the best way of saving rural Canada from depopulation and its local economies from spiralling downward, a university researcher told a Senate committee examining rural poverty.

But New Brunswick lacks some of the very means to establish those links, another expert pointed out.

“The largest factor driving community growth in rural Canada is proximity to cities,” said Mark Partridge, who is affiliated with the University of Saskatchewan.

“Immigration, fostering entrepreneurship and social capacity are all secondary to that.”

In Atlantic Canada, his research reveals higher household incomes within a 200-km radius of Halifax than elsewhere in Nova Scotia. That’s evidence the critical mass of population and services in the city generate positive spin-offs in a broader “regional cluster” even beyond the commuting zone that most closely rings cities.

“Effective public policy must create these regional growth clusters to ensure rural Canadians benefit from the activity in cities,” argued Partridge.

One policy would be to create elected regional bodies that govern both urban and rural areas, which are too often at odds or, in the case of small scattered rural locales, ignored by provincial governments, said Partridge.

Partridge said even cities as small as 10,000 people can be leveraged to increase rural growth.

“It doesn’t mean everyone has to be a commuter – but you need just enough people to generate more income and sustain vital services.”

David Bruce, director of the Rural and Small Town Program at Mount Allison University, said New Brunswick’s largest cities are already seeing the effect outside the immediate urban sprawl around Moncton, Saint John and Fredericton.

“It’s happening just naturally with a north-to-south migration and a rural to near urban migration,” he said. “It’s not just people coming from Bathurst to Moncton but from Bathurst to Grande-Digue.”

He said for emerging economic “city-states” to be successful, they need a healthy rural hinterland within a 100- or 200-km radius.

But in New Brunswick, rural areas suffer from a lack of land-use planning and enforcement, and from weak local government because local advisory districts lack power, leadership and resources.

“We’re lacking the capacity for stronger rural-urban growth and linkages – the city often doesn’t have a rural counterpart to talk to,” he said.

About 15 to 16 per cent of rural New Brunswick is under the poverty line, said Bruce, depending on the community.

Bruce blamed high levels of student debt for deterring young graduates from returning to their rural roots and indeed, for forcing them out of Atlantic Canada.

“We’ve heard many stories in the communities I work in where people are lamenting that they have to go to central Canada or the Alberta oilsands to pay down their debt,” he said.

“It’s a huge factor in the out-migration we’re seeing.”

He suggested government look at how it could offer more help to students from rural areas who could not possibly commute to their college or university, but have to move.

Bruce also argued personal income supports, such as more realistic social assistance and employment insurance benefits, are part of the solution. A market-based measure of income needed to afford necessary household expenses means a family of four in rural Canada needs $24,000 to $28,000 after taxes, he said, or a wage of $13.19 to $15.39 an hour (after taxes.)

“We know that a lot of the jobs that have been created in rural Canada in the last 20 years are paying below what’s needed to make a go of it,” he said, and urged the committee to invite provincial ministers of social services before it.

Employment insurance policy must take into account the seasonality of many rural industries.

“We have to avoid penalizing people for working in seasonal industries and for being rooted in the communities where they grew up,” he said.

Social assistance rates across the provinces fall between 50 per cent and 80 per cent below the so-called poverty line, he said.

“I’m not here to advocate just dumping more money into social assistance,” he said.

“It’s a combination of income support and policy supports that’s needed.”

But he gave equal weight to other supports that low-income rural residents need, including help with child care, transportation and housing.

“It’s not good enough to say ‘you need to get a job, here’s a year of training,’ ” he said.

“What is that’s a single mother with young children at home and no child care?”

Conservative senator Hugh Segal said that all the subsidies and other supports to U.S. farmers are tantamount to a guaranteed annual income for American rural areas, “without the Americans calling it that for ideological reasons.”

He asked if some sort of guaranteed annual income would work in Canada.

Partridge preferred a refundable tax credit available only to low-income earners who earned income.

“It’s essentially a subsidy to work and it’s been successful in the U.S.,” he said.