Halifax, NS, March 30, 2012: Nova Scotia committed up to $304 million in loans as part of Irving Shipbuilding's successful bid for the $25 billion federal combat vessel shipbuilding program, Premier Darrell Dexter revealed today, March 30.
It is the single largest investment in jobs and growing the economy in Nova Scotia's history - to strengthen the competitiveness of Irving Shipbuilding's bid to build Canada's next fleet of combat ships. It represents six per cent of the tax revenue the province expects to receive in return.
"I, the entire province, and indeed people from across Canada, have stood behind Irving's bid from day one, knowing that the best ships in the world start right here," said Premier Dexter. "This is the single most important opportunity Nova Scotia has ever seen to create jobs and propel our economy into the future. This is a vital project for Nova Scotia and for Canada."
To strengthen Irving's bid, the province committed to a financial assistance package that includes a forgiveable capital loan worth up to $260 million, and a repayable marine industry loan worth $44 million for human resource development, technology and industrial development. The province also committed to loan guarantees, if needed, as the contracts are finalized.
The provincial investment was crafted to support key competitive features that would help put the Irving bid in front. They include providing access to working capital, modernizing the yard, and ensuring that beyond the cost of the ships, there would be no additional cost to the federal government.
"We appreciate the vision shown by the province and Premier Dexter in recognizing the significant impact the new federal shipbuilding contracts will have in Nova Scotia," said Jim Irving, CEO of Irving Shipbuilding. "The province has consistently shown its commitment to the skilled men and women at Irving Shipbuilding.
"During the past 15 years, Nova Scotia's confidence in our capabilities made us a contender, earning the highest score and the right to build Canada's next generation of combat vessels. We would not have won without Nova Scotia's support. Today we partner to build quality ships, a growing workforce and a lasting centre of excellence that will provide a substantial return on the province's support."
While the province invested up to $304 million in the bid, the impact of the shipbuilding work is estimated to result in $2.8 billion in additional revenue to the province over the course of the next 19 years.
Activity flowing from the shipbuilding bid provides the province a tremendous opportunity to create jobs and grow the economy for the future, in particular through: regional and national cooperation; workforce training and development; supply chain development; innovation and excellence; and international investment and partnerships.
As part of the agreement, Irving will contribute $250,000 per year, over the next 30 years, to support the Irving Shipbuilding Centre of Excellence at the Nova Scotia Community College. The centre will provide opportunities for Nova Scotians to learn about career options in the shipbuilding industry and about the training involved in becoming the best shipbuilders in the world.
The province will also work with Irving to develop an early apprenticeship program and a ten-year workforce plan to ensure Nova Scotians are aware of future opportunities, and so our education and training institutions can plan and deliver relevant training.
Irving will continue to work with the Ships Start Here partnership to participate in supply chain development as work continues on a strategy to help companies develop skills and certifications to become a supplier or subcontractor.
"Nova Scotia won these contracts fair and square, but let me be clear, the opportunities in front of us are not entitlements. To achieve the greatest growth and transformation of our economy, we will have to work together and work hard. If we don't, others surely will," said Premier Dexter.
The contracts, estimated at $25 billion, will help the province turn a corner on 20 years of slow economic growth in Atlantic Canada. It will mean an additional 11,500 jobs for Nova Scotians and will increase the province's GDP by almost $900 million during peak production years. The Canadian economy is expected to grow by $1.5 billion, and 4,500 jobs will be created outside of Nova Scotia.