Professional Documents
Culture Documents
This section, utilizing publicly available information, will involve a descriptive analysis of
how the Newfoundland and Labrador has evolved in the past 20 years.
It will also, in collaboration with the Department of Finance and utilizing information
available to the study team, develop forward looking high, medium and low scenarios
for the short-term (within two years), the medium term (within five years) and longer
term (within 20 years).
The historical review will provide context from where Newfoundland and Labrador has
come, while the forward-looking scenarios will provide a context for future
opportunities and help define the parameters that will constraint future economic,
fiscal, social and demographic policies.
An understanding of where the economy has been, how it is evolved and where it might
go will be beneficial in shaping fiscal policy with a forward-looking strategy that will
allow Newfoundland and Labrador to focus on policies of the future and not policy of
the past. For example, the need to ensure sufficient jobs and an industrial policy
focused on the same can be replaced by a focus of how to ensure that sufficient skills
and people are available to meet the demands of the economy while enhancing the
efficient use of resource.
This section will review how the demographic characteristics of the province have
changed and the challenges that this has presented for policy education, health,
poverty, populations strategies, immigration policies and retention policies.
Using demographic profiles available from or developed by the Department of Finance
and/or Statistics Canada and a review of the relevant literature, this section will discuss
the implications of the demographic profile for public policies (taxation, public
expenditure on health, education, and immigration), the economy (housing, the labour
force and economic development).
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This section will review the past (the last 20 years) and current fiscal circumstances.
Specifically, this will involve an analysis of the evolution of public expenditures by
source and government revenues by source. This analysis will also consider debts and
deficits and how they have evolved in both as-spent dollar terms and real terms.
Scenario development and simulation analysis: oil and gas, other natural resource and
other provincial government revenues will be simulated, utilizing various price and
production scenarios.
This forward-looking analysis will draw on the demographic and economic profile
developed and/or utilized above. This will also involve collaboration with the
Department of Finance and the use of Statistics Canadas SPSM simulation model.
This section will all assess the role that commodity prices play in provincial fiscal and
economic policies.
Issue 5: Legacy or Heritage Funds what are they and do they make sense in the
Newfoundland and Labrador Context?
This chapter will start with a literature review of the issues. It will describe the various
types of funds that are or have been in existence. How they work? The pros and cons
of these types of funds and whether these are appropriate in Newfoundland and
Labrador given its current and anticipated economic circumstances.
As well, this discussion will consider how legacy and heritage funding in a resourcedependent economy can be utilized as a risk management strategy in the presence of
volatile commodity prices.
How does this work in practice and in other jurisdictions? Are there lessons for
Newfoundland and Labrador?
Is this a way to reduce the rural-urban divergence?
What are the economic issues associated with natural versus forced diversification (both
industrial and geographic)?
This section will also consider how public services, such as education and health can be
utilized to attract and retain people within the province.
As well, this section will consider the trade-off between resource-driven, industrial
policy versus royalty optimization.
Issue 8: Innovation
In addition to spending reductions and tax increases, a jurisdiction can improve its fiscal
situation by increasing the rate of innovation. Based on previously conducted work on
Newfoundland and Labradors productivity, this section will assess the state of R&D and
innovation in the province using Statistics Canada and NL Department of Finance data.
In addition, this section will review the Newfoundland and Labrador innovation system
more broadly, identifying leverage points and bottlenecks that foster and impede innovation,
respectively. This can include an overview of academic research and business R&D,
networking and innovation facilitation, financing, public policies, procurement, end-user
demand, and other factors.
This section will compare Newfoundland and Labrador to other jurisdictions with similar
characteristics.
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Finally, this section will review innovation in areas of significant public expenditure (e.g.,
health, education).
This will consist of a random opinion survey to determine what people know about
various expenditure and tax information within the province and the economic
interrelationships in general. This will also solicit information on peoples understand of
various fiscal trade-offs and willing to accept or not these trade-offs. An analysis of the
factors that affect these perceptions will also be performed. As well, the survey will
have a geographical dimension to it to determine. This survey and the associated
analysis will help us assess whether people really understand governments role and
whether this role should be smaller within the context of mature and sustainable
economy. It will also enable us to examine whether there is a gap between perception
and reality pertaining to the role of government.