Andrew Furey left the world of medicine to become the premier of Newfoundland and Labrador, a first-time politician running a province teetering on the brink of fiscal disaster.
KARA O`KEEFE/The Globe and Mail
Andrew Furey has something to prove.
In the middle of a successful career as an orthopedic surgeon, Mr. Furey left the world of medicine to become the premier of Newfoundland and Labrador, a first-time politician running a province teetering on the brink of fiscal disaster.
While someone who fixes bad knees might seem like an unusual choice to lead Newfoundlands economic renewal, it was a move that should have surprised no one in the province. Mr. Furey, an overachiever from a well-connected political family, had been pegged by party insiders to replace former premier Dwight Ball since 2017. He has a wide base of support among Liberals, seen as someone who can bring new energy and ideas in a province tired of the status quo from its leaders.
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When he announced last spring his intention to enter politics and seek the provincial Liberal Party leadership, he was quickly endorsed by most of Mr. Balls cabinet.
Now more than three months into the job, Mr. Furey is a man on a mission. He wants Newfoundland to be seen as forward-thinking and economically diverse while freeing government revenues from their dependence on commodity prices. Hes embraced both conservative and progressive ideas talking openly about privatization of government services, while also introducing $25-a-day daycare designed at getting women back to work in the pandemic.
I want to prove to the rest of Canada that Newfoundland and Labrador can reinvent itself yet again, he said during an interview in his office at the Confederation Building in St. Johns.
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The skeptics are plentiful and the hurdles monumental. His province was already grappling with an $800-million deficit before it was hit with the pandemic and the collapse in revenues from its offshore oil and gas sector. Newfoundland is now facing a $2-billion deficit this fiscal year. DBRS Morningstar, a global credit rating agency, estimates the provinces adjusted debt-to-GDP ratio could rise to a staggering 70 per cent in 2020-21.
St. Johns-born and raised, Mr. Furey knows how some people see his province and its challenges. As a first-year university student in Halifax, he felt judged for being from the Rock, according to his new book, Hope in the Balance, a memoir project that began long before his entrance into politics. Many Newfoundlanders carry that with them, Mr. Furey says a feeling they are underestimated by the rest of the country.
Mr. Furey sells Newfoundland as a haven from COVID-19, a place where life is affordable, leveraging the islands natural charm. The province, which has strict entrance restrictions to limit the virus, has one of the lowest infections rates in the world, recording only four deaths and fewer than 340 total cases since the pandemic began.
Hes promised big, bold solutions to Newfoundlands fiscal challenges, and says privatization of some services is a possibility. He appointed Dame Moya Green, the former chief executive of Canada Post who pushed for privatization while head of Britains Royal Mail, to lead the provinces economic recovery team tasked with coming up with a plan to address Newfoundlands ballooning debt, deficit and expenditures.
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There are other signals he intends to do things differently. In a province that leads the country in rates of heart disease and strokes, Mr. Furey is a runner who wants Newfoundlanders to live more healthy lifestyles. Far too much health spending is on avoidable health conditions, he argues. More than any other province, Newfoundland needs to find innovative and cost-effective new ways to deliver health care.
He plans to invest in retraining for displaced oil workers, and increase computer programming and coding programs for students to grow the provinces budding tech sector. Its a transition strategy endorsed by economists such as Memorial University of Newfoundlands Doug May. The academic argues Newfoundland needs to eliminate its boom-bust cycle by diversifying away from staple commodities such as fish, lumber, oil and minerals.
But Mr. Furey also needs Canadas help, and is hoping for a federal bailout from Ottawa. His province has been crippled by debt from Muskrat Falls, the troubled Labrador $13-billion hydro project, plagued by staggering cost overruns and delays that have risked doubling electricity rates.
Persuading the federal government to provide assistance wont be easy when other provinces are also asking for help, said Stephen Tomblin, a retired political science professor in St. Johns. It will be especially difficult when Muskrat Falls, the largest source of provincial debt, was basically given a blank cheque by the province to the public treasury.
That debt falls on top of the provinces chronic economic pressures caused by fluctuations in its resource-based industries, and its shrinking population, fuelled by a challenging mix of old age, a low birth rate and near-stagnant immigration.
Theres no sense in sugar-coating the situation that were in. We have an economic crisis. We have a demographic crisis. We have a fiscal crisis, one that has only been compounded by the changing revenue streams with respect to oil and gas, Mr. Furey said. We cant cut our way out of this crisis. We need help to get this ship into safe harbour.
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Part of the problem is what he calls an unequal equalization system where volatile oil resources are counted as an asset by the federal revenue-sharing formula. Newfoundland and Labrador hasnt received an equalization payment since 2008, partly because the formula doesnt adjust for the decline in provincial government royalties when oil prices drop. Meanwhile, Nova Scotia and New Brunswick each receive more than $2-billion in paymentsa year.
Newfoundland is also dealing with challenges that are unique for Atlantic Canada. It has only 520,000 residents, spread over a landmass three times the size of New Brunswick, Nova Scotia and Prince Edward Island combined. That creates enormous problems for the delivery of government services, such as schools, roadsand hospitals.
People didnt necessarily choose to live in the crooks and crannies and coves around Newfoundland. Theres a 500-year history embedded there, Mr. Furey said. But were still obliged to provide services to those people.
Yet he draws confidence from history, knowing Newfoundland has faced economic crisis before and has weathered the storm. Mr. Furey was a teenager when his provinces cod fishery collapsed, causing an out-migration of people and an economic downturn that still lingers in many rural Newfoundland communities today.
Thats still fresh in our minds. We reinvented ourselves after that and we will reinvent ourselves moving forward, Mr. Furey said.
One of his biggest challenges as Premier lies outside of Newfoundlands borders. He needs to persuade the rest of Canada to rewrite the equalization formula and spend millions to help bail out the province in its time of need, Mr. Tomblin said. If he can appeal to Canadians beyond Newfoundlands boundaries, I think that will be the biggest measure of his success.
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But Ottawa, with a soaring federal debt load expected to hit $1.2-trillion in 2020-21, is getting demands from all the provinces struggling through the pandemic. It has given $320-million in emergency funding to Newfoundlands struggling oil and gas sector, but has has not promised any kind of larger bailout.
Newfoundlanders have right to be a bit skeptical after years of unsustainable deficits and government spending scandals such as Muskrat Falls, Mr. Tomblin said. The economic boom and high oil prices that made Newfoundland a have province under former premier Danny Williams have given way to familiar patterns of rising unemployment and out-migration.
Long-term changes are required to fix the chronic problem of structural deficits, Mr. Furey said. Lori Lee Oates, a historian from Memorial University, argues the provinces spending isnt out of control its debt servicing costs, over $1-billion a year, are the real issue.
Weve been engaging in austerity for years, and it really hasnt made us any richer as a province, she said. The problem weve got is all of our money is tied up in things that are not benefiting the average citizen.
Muskrat Falls is a particular source of anger, Dr. Oates said. Its draining government resources, providing few jobs and only pushing electricity bills higher, she said. Previous governments have been able to lean on offshore oil revenues, but those royalties have plunged this year as oil prices collapsed.
Economists such as Dr. May argue the main barriers to Newfoundlands transition have been political. He and others say the province, which maintained the status quo for too long by borrowing more money, may have to adjust to a lower standard of living as it shifts away from a dependence on oil.
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While hes never held public office before, Mr. Furey has deep political roots. His father, George Furey, is the Speaker of the Senate of Canada, and his uncle Chuck Furey was a long-time provincial legislator, and served in the cabinet of Clyde Wells. The new Premier has also chaired provincial and federal election campaigns, including for Seamus ORegan, the federal Minister of Natural Resources.
Andrew Furey was involved in Liberal politics from a young age and remembers heated political debates around the family dinner table. While the Furey household may have argued over everything from abortion to provincial debt, cynicism for public service was never allowed, he said.
The only thing my father wouldnt tolerate is the opinion that politicians and people who step up cant be the agents of change, said the 45-year-old father of three. In order to change something, you need to step up.
Its expected his toughest decisions will come after the next provincial election, which must be called by next August. He wants to prove that hes ready to redefine his province.
The Premier understands Newfoundlanders and Labradorians are growing increasingly worried about the future. He writes in his new book that he saw how hope can help people during his medical aid work in Haiti, where he co-founded Team Broken Earth, a volunteer task force supporting the relief effort after the 2010 earthquake.
Premier of Newfoundland & Labrador, Andrew Furey, sits in his office at the Confederation Building on a foggy day in St. John’s, Newfoundland on Oct. 8, 2020.
KARA O`KEEFE/The Globe and Mail
While Haitis problems are certainly deeper and more desperate than those in Canadas poorest province, there are some parallels to Newfoundland, he said. Theyre both islands settled by foreigners, crippled by debt and with a feeling of isolation from the rest of the world. Their residents have developed a strong sense of community because of those historical challenges, Mr. Furey said.
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Newfoundlanders and Labradorians have overcome plenty of difficult days before. Together, theyll get through this new crisis, too, he said.
Wed had a different path from Haiti, but weve also had our struggles. Our sense of community has been driven by that history of isolation, he said. We needed it to survive.
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