5.5 indirect benefits

graduates remain in the North; consequently, their spending is retained within the northern part of the province. Few graduates own condos in Canmore or Whistler; none have yet retired in Kelowna or on Vancouver Island. The vast majority of NORTEP-NORPAC graduates’ earnings remain in Saskatchewan, mainly in the North.

Given the socio-economic profile that emerges from a “no NORTEP-NORPAC” scenario, the creation and maintenance of the NORTEP-NORPAC programs becomes—in the colloquial language of the day—simply a “no brainer”!

5.5 Indirect benefits

The impact analysis thus far has focused on direct costs and primarily on direct economic benefits of the NORTEP-NORPAC programs. We have noted the gross earnings of the graduates, for example, and calculated the taxation contributions they make in comparison to the costs associated with funding the NORTEP-NORPAC program. It will, however, be immediately apparent that direct costs and benefits are only part of the impact story. Although the direct-costs picture is quite dramatic, from a socio-economic perspective, it is really only a small part of a much larger picture—one that has a story of its own. Indirect benefits, in particular, combine with the direct benefits to create an impact that can only be described as truly massive: By moving to include indirect costs, rather than simply direct costs, we have moved from an acorn to an oak.

The indirect benefits of economic development touch every aspect of a society. The indirect benefits act as a multiplier—an amplifier—for the direct benefits that we have already noted. Indirect benefits accrue from the total expenditures related to a program; in the case of NORTEP-NORPAC these are represented by program expenditures, as well as the earnings (and thus spending power) of its graduates. The two sources of expenditure combine synergistically; they work together to create an even more powerful impact than is apparent from what is merely a direct cost-benefits analysis.

From a direct cost-benefits perspective, we have primarily taken into account the benefits to government derived from the taxation of graduate earnings. From an indirect perspective, however, we will want to examine the total impact of spending by the program in the form of salaries, goods and services, as well as the total income spending of the graduates (in the form of expenditures of all kinds). These expenditures together impact and benefit every aspect of an economy and a society. Total benefit needs to recognize not only the taxes paid by salaried employees and program graduates, but also the general impact of program and employees’ and graduates’ spending. Aboriginal role models provide inspiration even in the school hallways

In 2005, for example, the combined economic engine represented by NORTEP-NORPAC could be represented as follows:

Table 23. Indirect cost benefits $ 2, 290, 000 400, 000 26, 637, 500 $ 29, 327, 500 core program funding and expenditures other sources of revenue graduates’ earnings Total It is vital to recognize that the benefits associated with these expenditures accrue primarily to northern Saskatchewan. The programs’ expenditures, for example, have historically impacted not only the town of La Ronge, but also virtually all other northern communities. La Ronge itself benefits considerably from the nearly 50 staff and over 100 students who are associated with the program (and reside in La Ronge for much of the year). The impact of these salary and program expenditures represents a significant contribution to the retail (goods and services) and real estate sectors of the La Ronge economy. Because the expenditures in La Ronge are based not only on the revenue generated by its core funding, but also by other sources of revenue, including the grants to students derived from the federal and First Nations governments, total expenditures are surely in the region of $2M. In La Ronge, benefit to the real estate sector has been created not only by rental and purchase revenues expended by staff, but also by the demand for student and visiting professor accommodation. Over the years these expenditures have been primarily associated with rental properties but, more recently, with the advent of the renovated McKay and Irving apartments—transformed into NORTEP-NORPAC Apartments East and West—there has been a conspicuous impact and presence in the form of larger property improvement and management. NORTEP-NORPAC have also made a contribution to the use and maintenance of the Mistasinihk Building and, in time, will doubtless require the construction, or purchase and renovation, of a building of their own. Significant capital funds will, surely, be associated with such a development. Historically, as well as today, associated with NORTEP-NORPAC there has also been a major expenditure impact throughout the North. During the fieldbased program era, when students lived in their home communities for half of the program life and earned student allowances, the benefits of these expenditures were experienced in the form of transportation (to and from La Ronge)—taxis and charter air flights—as well as the personal demand for goods and services in the students’ home communities. Construction underway on a unique concept: a combined high school and health centre in Île-à-la Crosse