The Evidence Network’s VP Research Dr. Margaret Dalziel Comments on Expert Panel Examining Ontario’s Business Support Programs
A 2014 expert panel examining Ontario’s business support programs, chaired by The Evidence Network’s VP Research Dr. Margaret Dalziel, has been released to the public. The panel’s newly-available report has led to an in-depth national discussion on the role of government in supporting businesses in Ontario and throughout the nation.
From the article:
“It’s kind of a race to the bottom,” Dalziel said. “When we give money to, say, Cisco, it is talking to a lot of jurisdictions” and trying to figure who offers the best overall environment, including wages and labour market and energy rates, among myriad factors. “If you believe that what we offer Cisco is no better than what another 12 jurisdictions offer, then it’s only who pays the most to get Cisco to come.”
“If we’re buying jobs, they’re very expensive jobs,” she added, explaining the average Cisco employee makes six figures and is employed in a sector of the economy with low unemployment.
“Whatever your rationale is, you should articulate it. When you take money from taxpayers and give it to private business — especially private, profitable, foreign businesses — you should be able to articulate why you’re doing it and then you should also years down the road follow up and see that it worked,” Dalziel said.
Micro-targeting specific sectors, whether it’s Ontario wine or biomedical science or information technology, is actually a good thing, Dalziel said, so the breadth of programs isn’t the issue, but the lack of central analysis and the fact the government does little to follow up on its jobs numbers.
“I think the big issue is it’s not clear to people why this is important,” [economist Mike Moffatt, a professor at the Ivey School of Business] said, adding “how do you measure that it worked?”
“The government doesn’t do a great job in tracking outcomes.”
“There can be instances where it does make sense… now those instances would be in cases where you have a lot of unemployed or underemployed people in an industry and then you pay some money to attract that industry to come to your jurisdiction,” he said. How do you measure that it worked? The government doesn’t do a great job in tracking outcomes.
But he also noted, like Dalziel, that it’s a perfect conundrum, because companies like Cisco do pit jurisdictions against one another.
The report’s release raises important questions about the optimal strategy for government support of business and innovation in Canada at a pivotal moment in Canadian innovation policy. To learn more about the panel’s research and recommendations, please view the full report here:
Dr. Margaret Dalziel has also contributed to the Council of Canadian Academies Panel on Innovation Impacts: Measurement and Assessment. That report is available here:
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