Bombardier loans ignite political tensions

OTTAWA — From the West came the calls of a double standard: why are the federal Liberals giving Bombardier Inc. a $372.5-million loan while thousands of jobs in the oil and gas industry remain consigned to the dustbin?

From Quebec, cries that the loan for the aerospace company was nothing compared to what the federal government has giving the Ontario auto sector.

From behind closed Liberal caucus doors, it was internal pressure from the Quebec caucus that partially forced the government to finally agree on some sort of financial assistance for the company, nearly a year and a half after it first began agitating for support. And in front of those doors Wednesday, the same Liberals were fending off accusations that the loan was nothing more than a political play.

There seem to be few companies in Canada that can set off more political bombs than Bombardier. The company’s repeated return to the federal till for extra funding — it has been receiving government loans since at least the mid-1990s — has made it a target for legitimate questions about how Ottawa doles out cash, said Martha Hall Findlay, the former Liberal MP who is now chief executive officer of the Canada West Foundation. “How are these decisions made? What are the criteria?” Findlay asked.

“What really happens is the more people realize that there’s no consistency, that there’s no real basis in evidence in the larger sense for subsidizing X as opposed to Y, or A sector as opposed to B sector, people see the incredible level of subsidization ... more and more people ask questions. And that’s exactly what you’re seeing again now.”

Round after round of questions were asked in the House of Commons Wednesday on the Liberals’ decision to extend the company a $372.5-million loan through a government fund set aside for initiatives in the defence and aerospace sectors. That fund sets specific terms on what the money can or can’t be used for, as opposed to the government merely handing over the cash the company wanted. As it stands, it is still far less than the $1 billion the company wanted when it first began making its pitch for federal assistance in 2015.

“I understand that the situation is changing, it is evolving, but obviously the federal government is not supporting a Quebec company the same way it supported cars in Ontario, oil in the west, Muskrat Falls in the Maritimes,” said Bloc Quebecois leader Rheal Fortin.

That it’s a loan keeps the money off the Liberals’ deficit tally, since it is registered as an asset. Not that they can count on the repayment to bolster their bottom line in the immediate future — the company will repay the loans through royalties on each aircraft sold.

But surely the government obtained some immediate benefit for Canadians? asked the NDP.

“You know what? We have no idea what’s actually in that deal,” said NDP Leader Tom Mulcair.

“And there appears that there’s no guarantee of maintaining those jobs in Canada.”

Innovation Minister Navdeep Bains insisted the funds — being handed out in instalments over four years to support the Global 7000 and CSeries aircraft projects — will secure at least 4,000 jobs.

Interim Opposition leader Rona Ambrose said the prime minister was sending a dangerous signal.

“Has the prime minister thought through the message that he’s sending? Does he plan to also bail out the dry-cleaning shop in Fort McMurray?”