It was inevitable that the pandemic would seriously challenge the budgets of all levels of government in Canada. All provinces, territories and the federal government have become debt-strapped under the exigencies of COVID-19 and unanticipated emergency assistance programs.
But Nova Scotia municipalities, already vulnerable with weak fiscal capacity in normal times, are now in dire straits in these uncertain times. Local governments are where the rubber hits the road, providing us with costly essential services paid for with local taxes and federal/provincial transfers.
All other governments are distant decision-makers with better tax capacity. Yet, municipalities have the most direct impact on our lives. We are best served by them every day and most inconvenienced when their services are halted or cutback. However, as the Nova Scotia Federation of Municipalities (NSFM) has frequently observed, local governments are inadequately funded and teetering on the edge of failure.
The vulnerability of rural governments worsened as a result of COVID-19. Last week, NSFM reported a lost revenue shortfall experienced by the province's 49 municipalities outside of the Halifax Regional Municipality (HRM). These municipalities are already vulnerable under the province's inadequate annual funding formula. The town of Mulgrave is the next victim.
Historically the provincial government, especially under the leadership of Premier Stephen McNeil, has taken a 'you're on your own‘ attitude toward all municipalities outside of Halifax. Many have failed or undergone some level of amalgamation after losing the capacity to sustain themselves. It has been a missed opportunity for the province to develop a special role for rural communities to contribute to the overall fate of the provincial economy.
As the Nova Scotia Federation of Municipalities (NSFM) has frequently observed, local governments are inadequately funded and teetering on the edge of failure.
The revenue report just released identified a $66-million collective shortfall caused by the pandemic. COVID-19 halted the revenue streams within local governments from services like transit, parking and permits.
However, even if this is resolved when the economy reopens, the structural weaknesses in rural governments will continue to be underfunded owing to the province’s policy approach to municipalities outside of the HRM. Provincial policy favours the dominant urban character of the capital region even though the majority of Nova Scotians live and work outside of Halifax.
Successive provincial governments have not recognized the significant role rural governments play in the economic development of the entire province. Rural municipalities and rural industries, such as agriculture, the fishery, forestry, and tourism among others, drive the economy of Nova Scotia, requiring strong local governments to service their needs.
A provincial strategy could address a unique role for rural communities as economic engines in the province.
There is a constitutional obligation on the part of all provincial governments (Section 36 of the Charter) to make sure municipalities can provide essential services at comparable levels of taxation throughout the province. The service infrastructures in rural Nova Scotia are fading rapidly and causing disadvantages to rural businesses and to personal lifestyles.
So we are a province that has assigned urban primacy to just one city, with rural areas including the CBRM losing their capacity to contribute to the entire economic culture of Nova Scotia.
In previous columns, I have referred to this regrettably as the "province of Halifax." Other provinces after decades of economic modernization have expanded the role of their secondary cities to play a more significant role for the entire province. Nova Scotia regards rural communities as potential losses rather than assets.
Tourism as an industry, for example, can link communities that try to go it alone on a tourist strategy. Each rural community can play a larger role in the economic development of the province. This is an opportunity for the government to redesign its economic development policy with a greater role for rural communities throughout the province. This could include business strategies for agriculture and forestry across the province.
Jim Guy, Ph.D., is an author and professor emeritus of political science at Cape Breton University. He can be reached at email@example.com.