BY RICHARD ROIK Telegraph-Journal

OTTAWA – Federal spending on economic development in Atlantic Canada spikes just before an election and flows disproportionately to government-held ridings, says the co-author of a new report.

Brian Lee Crowley, president of the Atlantic Institute for Market Studies, said the trends uncovered in an exhaustive study are irrefutable.

“The spending is clearly politically motivated,” Mr. Crowley said in a telephone interview.

According to the figures, compiled by the C.D. Howe Institute, the total value of grants and contributions from the Moncton-based Atlantic Canada Opportunities Agency have tended to peak just before the federal election calls in 1988, 1993, 1997 and 2000.

As well, Mr. Crowley and co-author Bruce Winchester write in the latest edition of their publication ACOA Watch that spending under former prime minister Jean Chrétien was, on average, 40 per cent higher in Liberal-held ridings than in opposition ridings.

The two authors also note that there has been a detectable trend to spend even more money in so-called swing ridings “where political fortunes may be narrowly won or lost.”

“The numbers don’t lie,” Mr. Crowley said. “ACOA cannot make the case that it is spending money for the benefit of the region. The fact is it is for the political benefit of the party in power, and that is as true under the Tories as it is for the Grits.”

Joe McGuire, the new minister responsible for ACOA, dismissed the allegations, adding that his long experience with the federal agency shows just the opposite.

“I think they’re pretty well hands-free as far as that (political) motivation is concerned,” Mr. McGuire said following a cabinet meeting Tuesday.

“Projects are reviewed on an individual basis, due diligence is done and decisions are made,” added Mr. McGuire, a 15-year Liberal MP from Prince Edward Island. “I know lots of times I would have preferred some project approvals and they never came.”

Mr. Crowley said in his report that ACOA’s $250 million in annual grants and contributions would be better spent financing corporate and small-business tax cuts to stimulate economic growth in the region.

Mr. Crowley added that Prime Minister Paul Martin “must give serious consideration to winding down the ACOA pork barrel.”