Torries Give nearly a Billion to the Aerospace Industry

[SmoothedShredder]

Boo. I don't like this move at all. Lets fix the roads in Quebec first, and let the airline industry shrink au nautral. They've both been getting too many subsidies for too long. Lets all hug.

Aerospace industry to get $900M boost

Last Updated: Monday, April 2, 2007 | 4:43 PM ET

CBC News

The Tories announced a $900-million aid package for Canada's defence and aerospace industry, with most of the money going to businesses in the politically key province of Quebec.

The money, to be spent over five years, will go to research and development under the Strategic Aerospace and Defence Initiative, a repayable contribution program.

Industry Minister Maxime Bernier, centre, said the government wants Canada's defence and aerospace industry to attract investment and develop new technologies.Industry Minister Maxime Bernier, centre, said the government wants Canada's defence and aerospace industry to attract investment and develop new technologies.

(Paul Chiasson/Canadian Press)

Industry Minister Maxime Bernier said the repayments will be calculated based on gross business income and the repayment period will be limited to 15 years.

Although the funding is not going specifically to Quebec, most of the top industry firms are based in the province, including aircraft manufacturer Bombardier Inc., engine builder Pratt and Whitney Canada, components maker Heroux-Devtek and CAE Inc., one of the world's biggest providers of pilot training services.

Bernier said the government wants the industry to attract investment, develop new technologies and commercialize new ideas.

"Your success is vital to our economy and it's vital to all Canadians from one ocean to the next," he said.

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In the past, the Conservative government has said it prefers cutting taxes to create a business-friendly environment over subsidies.

The Aerospace Industries Association of Canada welcomed Monday's news, with chairman Don Campbell saying the new program will require aerospace companies to invest three to four dollars of their own capital for every federal dollar received.

"It's a risk-sharing partnership that is critical to sustaining the more than $1 billion our companies invest each year in aerospace R&D in Canada," Campbell said.

But federal Liberals are criticizing the new funding announcement, saying it amounts to politicking.

"They [the Conservatives] attacked government investment in aerospace as unwarranted government subsidy," Scott Brison, the Liberal industry critic, told the Globe and Mail.

"And in a pre-election environment, they're trying to do the same thing. These guys are the patron saints of hypocrisy.

"This sounds like a pre-election, ad hoc drop in the bucket to improve the perception of what they've done for aerospace."