Nova Scotia Business Inc. (NSBI) hopes to create 420 new jobs in the province by giving rebates to three companies over a five-year period: Canadian Maritime Engineering Limited (CME), Mobivity Holdings Corp. (Mobivity), and TD insurance.
These rebates will be in the form of payroll rebates, designed in a way that the tax revenue generated for the province by the new jobs in Nova Scotia is always more than the amount spent on the rebate.
In other words, the money given to CME, Mobivity and TD Insurance is helping pay for their labour costs, but that money (and more) is expected to be generated back by the people who choose to live and spend money within the province.
NSBI is ready to spend close to six million dollars for new jobs, with TD Insurance receiving the lions-share of that money. The province is giving them close to four million dollars.
For every dollar a company spends on new jobs, it receives between five and 10 cents back from the payroll rebate. That means a total of $73 million could be spent on new jobs, with up to $7,762,387 going back to the company.
The province hopes that will provide a strong incentive for companies.
“It’s a low risk mechanism for us to play in the competitive sphere,” said NSBI President and CEO Laurel Broten.
In order for the companies to receive the payroll rebates, they have to prove to the NSBI the jobs they’re creating exist.
The NSBI is being cautiously optimistic in that regard — when a company submits an annual rebate claim, it must send NSBI audited information that confirms the number of jobs it created that year.
If the company doesn’t meet the quota of jobs demanded by the company, it receives less money.
Broten says this sort of model isn’t commonly used in other provinces, and holding companies accountable to their promises is a part of Nova Scotia’s strategic economic growth plan.
“It’s our mandate to grow the Nova Scotia economy,” said Broten.
The payroll rebates are paid through the Strategic Investment Funds.