Tim Houston argues that restrictive policies are stifling economic opportunity and increasing reliance on equalization payments
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Nova Scotia Premier Tim Houston recently made waves by expressing a taboo sentiment in Nova Scotia: the province has banned the extraction of too many natural resources, and it is time to move toward self-sufficiency.
“We must take the ‘no’ out of Nova Scotia. Special interests have captured too many parts of our economy and have had an outsized voice in policy creation. That must end. Outright bans of entire sectors are lazy public policy, and we will reverse bans and focus on meaningful, mature discussion,” Houston said.
He added, “[We] can’t expect Nova Scotia to prosper when we ban industry after industry after industry.” The premier also questioned why the province has banned activities that are important to the economy but are conducted safely in other jurisdictions.
In another surprise move, Houston called for the revival of the Energy East pipeline project, which proposed transporting oil from Alberta to New Brunswick. His remarks signal he is serious about breaking free from the ideological constraints that have long shaped Nova Scotia’s resource policy.
 Nova Scotia Premier Tim Houston: Outright bans of entire sectors are lazy public policy. |
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For those unfamiliar with Nova Scotia’s resource issues, the province has banned uranium exploration and mining since 1981, maintained a ban on hydraulic fracturing, or fracking, and imposed a moratorium on oil and gas development around the fishing grounds of Georges Bank. However, Houston’s comments came in the context of looming U.S. tariffs, which he warned could damage provincial revenues. The government is re-examining resource development to generate local revenues and offset potential losses.
Houston also pointed to the province’s aging population and the growing cost of health care as justification for finding new revenue sources. Either way, he has opened a necessary and long-overdue conversation in Nova Scotia. His decision to open this proverbial can of worms raises broader questions about resource development in other underperforming parts of the country and the equalization formula.
Some may assume Nova Scotia’s reluctance toward resource development is driven by opposition to industry or climate policies. However, it is often NIMBYism—“not in my backyard” resistance—that is the real culprit. Residents with secure jobs and comfortable livelihoods are often the loudest opponents of industry, particularly when development affects their communities or disrupts the ocean views from their summer cottages. Some commentators have documented the coastal building boom in Nova Scotia over the last several years.
The issue of property rights and land use is always fraught with tensions as competing users share common spaces. While Nova Scotia markets itself as “Canada’s ocean playground,” as its licence plates proclaim, residents must learn to share this playground with all users, including those involved in energy and mining. If the province wants a growing economy, it must accommodate a stronger resource sector. Politicians and policymakers across Canada, including in Nova Scotia, must ensure land-use policies and provincial planning support multiple types of development and protect commercial interests, as these benefit all residents—even those who may not realize it.
Another major impediment to resource development is the organized strength of the fisheries sector. No one doubts that fisheries are a staple of the province’s economy and a cultural anchor for many communities. However, opposition to resource projects is often led by fishing interests. All ocean-facing provinces must balance competing industries and economic opportunities.
Nova Scotia also has an opportunity to address NIMBYism and the influence of legacy industries while tackling the challenges posed by equalization incentives. David MacKinnon, a senior fellow at the Frontier Centre for Public Policy, has argued that regional subsidies such as equalization create a “moral hazard,” shielding recipient provinces from the economic consequences of their policy decisions. For the average Nova Scotian, everything may appear normal despite deep structural issues.
Former federal finance minister Joe Oliver has similarly argued that the equalization formula creates a disincentive for provinces to develop their natural resources. He has questioned whether penalties should apply to jurisdictions that reject resource development while continuing to receive equalization payments.
If Nova Scotia embarks on the path Houston favours, the province would not only benefit itself but could also set an example for other “have-not” provinces. A broader conversation is needed about responsible resource development and the policies that hinder it.
Houston has cracked open a difficult but necessary debate. The question now is whether Nova Scotians are ready to embrace the challenge—or whether they will continue saying no at their own expense.
Joseph Quesnel is a senior research fellow with the Frontier Centre for Public Policy.
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