THE WEEK

Relief

Which promises count when catastrophe strikes

JOHN GEDDES September 8 2003
THE WEEK

Relief

Which promises count when catastrophe strikes

JOHN GEDDES September 8 2003

Relief

Which promises count when catastrophe strikes

When it comes to qualifying for federal relief, not all disasters are created equal. Floods, yes. Epidemics, almost never. Fires, sometimes. Not since the Book of Job, it seems, have the categories of catastrophe needed so much sorting out. Provinces are lining up for money from Jean Chrétien to cope with SARS, forest fires, mad cow disease and more. He promises to help. But the question is, how much? And from which federal programs? News that Finance Minister John Manley is seeking cuts in defence, foreign aid and other normal spending signalled that the need to

Just how generous the Liberals will be remains unclear. But there are rules when it comes to tapping the core emergency plan called Disaster Financial Assistance Arrangements—though lately its guidelines have been a source of confusion. David Neville, the director of financial assistance programs, explained the fundamentals to Maclean’s. To

come up with emergency aid is causing a mad scramble in Ottawa.

begin with, Neville stresses that disasters must be sudden and unforeseeable to qualify. So a drought doesn’t count, but a flood does. Then the calamity must be severe enough to cost at least $1 dollar in “eligible costs” for every person in the province where it happens. Federal assistance can then be up to 90 per cent of this extra cost.

Normal provincial spending, like firefighting, doesn’t qualify. Neither does anything covered by insurance-or that should have been insured. But if a province decides to compensate small businesses for actual damage or non-insurable inventory, Ottawa will chip in. Big business, though, is out of luck—and that means no DFAA money to Ontario electricity companies for blackout damage.

DFAA dates from 1970. But the biggest payouts all came in short succession in the late nineties—Quebec’s Saguenay River flood of 1996, Manitoba’s Red River flood of1997, and the ice storm that hit Quebec, eastern Ontario and New Brunswick in 1998. Evacuations caused by forest fires are sometimes compensated, as is rebuilding roads and things like sewer lines. But Neville says health emergencies have never been considered eligible for compensation—one of the reasons for an angry standoffbetween Ontario and Ottawa over SARS compensation. Ontario wants nearly $1 billion in disaster-like relief; Ottawa is offering $250 million for specific costs.

Finally, a key program limit is that it applies to the direct cost of grappling with a disaster, not the wider economic fallout. That means no DFAA payments to cover Chinese restaurants in Toronto abandoned during the SARS scare, or fishing lodges in the B.C. Interior left empty as the forests burned. That is unless there is a huge political hue and cry. And then we’re into the Squeaky Wheel Rules of compensation that only campaigning politicians understand.

JOHN GEDDES