Industry Canada has dolled out $22.1 billion in corporate welfare since Diefenbaker: report

Andy Radia

The term 'welfare bum' conjures up an image of an able-bodied yet lazy malcontent individual living on the government dole.

Maybe we need to expand that definition.

The Fraser Institute's Mark Milke is again raising alarm bells about the level of corporate welfare in this country.

In his latest report, titled Corporate Welfare at Industry Canada since John Diefenbaker, he claims that one department — Industry Canada — has dolled out $22.1 billion to businesses since 1961. Of that $8.8 billion was given in grants (ie: money that doesn't have to be paid back).

He even 'outed' some of the largest benefactors: Pratt and Whitney, Bombardier and De Havilland Inc. topped the list with government receipts totaling $3.2 million, $1.1 million and $1.08 million respectively.

"Corporate welfare is rampant in Canada." Milke wrote in an accompanying press release.

"Unfortunately, going all the way back to the early 1960s, successive federal governments demonstrated the same chronic pattern of handing out taxpayer money."

[ Related: Critics slam Tories’ $250 million auto investment as corporate welfare ]

And it's not just the big companies that are benefiting. Industry Canada has also been handing out cash to hot dog stands, ice cream parlours and gas stations.

Twenty-four separate contributions worth $856,570, for example, were provided to ice cream shops.

And 'here's the kicker, according to Milke: corporate subsidies actually don't create jobs, as advertised.

Milke — who has written extensively about this topic in recent years — notes that virtually all peer-reviewed research on business subsidies conclude that they don't have a demonstrable positive impact upon the economy, employment, or tax revenues because of the substitution effect. In other words, a subsidy meant to "create" jobs in one industry simply shifts intended investment — and jobs — away from another.

[ Related: Fraser Institute report suggests hospital wait times cost Canadians almost $1B a year ]

Corporate handouts are also prevalent in other departments and other levels of government.

A 2007 study pegged the national corporate welfare bill at $15.6 billion a year, which led one journalist to opine that expenditures on corporate welfare are almost twice that of expenditures on social welfare.

And, just in case you were wondering, our national debt now stands at $617,859,380,000.

(Photo courtesy The Canadian Press)

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