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### Viewing cable 06HALIFAX92, NOVA SCOTIANS OFF TO THE POLLS IN A JUNE PROVINCIAL

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Reference ID | Created | Released | Classification | Origin
--- | --- | --- | --- | ---
06HALIFAX92 | 2006-05-14 03:03 | 2011-04-28 00:12 | UNCLASSIFIED//FOR OFFICIAL USE ONLY | Consulate Halifax

`

    VZCZCXRO3727
    PP RUEHGA RUEHQU RUEHVC
    DE RUEHHA #0092/01 1340348
    ZNR UUUUU ZZH
    P R 140348Z MAY 06
    FM AMCONSUL HALIFAX
    TO RUEHC/SECSTATE WASHDC PRIORITY 1000
    INFO RUCNCAN/ALL CANADIAN POSTS COLLECTIVE
    RUEHOT/AMEMBASSY OTTAWA 0358
    RUEHHA/AMCONSUL HALIFAX 1064

` `

    UNCLAS SECTION 01 OF 02 HALIFAX 000092

    SIPDIS

    SENSITIVE
    SIPDIS

    FOR WHA/CAN

    E.O. 12958: N/A
    TAGS: PGOV ETRD ECON CA
    SUBJECT: NOVA SCOTIANS OFF TO THE POLLS IN A JUNE PROVINCIAL
    ELECTION

    REF: A)  HALIFAX 35; B)  HALIFAX 90

    HALIFAX 00000092  001.2 OF 002

    SENSITIVE BUT UNCLASSIFIED -- PROTECT ACCORDINGLY

    ¶1.  (SBU)  SUMMARY:  Conservative Premier Rodney MacDonald has
    called a provincial election for June 13.  Issues of potential
    bilateral interest will be: offshore energy and liquefied
    natural gas (LNG) policies, subsidies to forest products
    companies, legislation aimed at shielding personal data from USG
    access and enhanced ferry service to the U.S.  Although
    MacDonald's early poll numbers look good, don't count out Nova
    Scotia's New Democrats, who have a decent shot at forming the
    first NDP government in Atlantic Canada.  END SUMMARY

    ¶2.  (SBU)  In what was the worst kept political secret of the
    year, on May 13 Tory Premier Rodney MacDonald called an election
    for June 13.  Although there are over two years left in the
    mandate that MacDonald inherited from former Premier John Hamm,
    MacDonald has been anxious to put his own stamp on the
    legislature.  In addition, the rookie Premier, who has been on
    the job since February, wants to end the increasingly cumbersome
    and weakening coalition that Hamm had skillfully forged and run
    with the two opposition parties to keep the government afloat
    and pass key legislation (ref A).  The 2003 election left the
    Tories without a majority and they hold only 25 of the 52 seats
    in the provincial legislature.  The official opposition New
    Democrats have 15, while the third-place Liberals have 10.
    Currently, there is one vacancy in the Legislature and one
    member sits as an Independent, a former Liberal who previously
    indicated that he would run as a Conservative when an election
    came.

    ¶3.  (SBU)  Also influencing the Premier's decision to call the
    election is his standing in public opinion polls.
    Election-watchers believe that if his numbers hold at their
    current 39% level, MacDonald could walk away with a majority
    government.  However, these are early predictions that do not
    take into account how the two opposition parties will structure
    their campaigns and what the response from the electorate will
    be.  While Macdonald can be expected to craft a platform focused
    heavily on the Tory record under the well-respected John Hamm,
    he has also tried to out-flank the NDP by introducing a
    relatively free-spending budget that takes several items from
    the New Democrats' platform, including a tax rebate on heating
    fuel.

    ¶4.  (SBU)  From the opposition side, the NDP, behind leader
    Darrell Dexter, will try to sell the party as a viable and
    experienced alternative to the Tories.  We can expect Dexter to
    make a strong effort to keep the momentum going for his party
    which just a few short years ago was in a distant third-place
    position in the province.  NDP officials have their eye on the
    history books -- if they succeed in forming a government it will
    be the first for the party in Atlantic Canada.  For Liberal
    Francis Mackenzie, who observers generally agree has had a
    lackluster tenure as party leader so far, the main challenge
    will be to keep the 10 seats he now has, plus ensure that he can
    win election himself and get his own seat in the House.

    ¶5. (SBU)  Issues in the campaign undoubtedly will be the basic
    bread-and-butter items such as health, education, the size of
    the provincial debt and creating a more favorable climate for
    business and industry.  Four issues likely to emerge that will
    be of interest to the United States are:  the energy sector,
    subsidies for forest products companies, privacy legislation and
    transportation.

    --  ENERGY:  Whoever forms the government will need to deal with
    declining interest in Nova Scotia's offshore energy resources,
    which have proven harder to find and produce than expected.  The
    MacDonald government is committed to moving ahead on development
    of offshore energy and is also looking at expanding LNG
    facilities in the province.  The other parties can be expected
    to come up with own ideas in these areas which will probably
    take until the campaign gets fully underway.

    --  SUBSIDIES:  The government has already proposed paying paper
    maker Stora Enso C$65 million over six years to help it keep
    operating a plant in Cape Breton, a high unemployment area and
    the Premier's home region (ref B).  In addition, the government
    announced the day before the election that it would buy land
    valued at C$26 million from Bowater Mersey, a paper
    manufacturer.  The Liberals have said that more needs to be done
    for Stora Enso, and other forest products companies have already
    started asking: "Where's mine?"

    --  PRIVACY:  Shortly before the election was called the
    government introduced legislation that aimed at keeping data on
    Nova Scotians held by U.S. data processing companies out of the

    HALIFAX 00000092  002.2 OF 002

    reach of the USG.  This issue has been important for the NDP as
    well so regardless of who wins the election we can expect to see
    new legislation proposed by the next government.

    --  TRANSPORTATION:  The issue of government help for improved
    or new ferry links from southwestern Nova Scotia to New England
    might emerge as an issue in those areas, especially in those
    districts where there are tight races.

    ¶6.  (SBU)  COMMENT:  While the campaign is just starting, this
    seems certain to be a close and exciting race.  Of paramount
    interest will be how the new Premier handles himself in his
    first electoral campaign as the head of Nova Scotia's
    Progressive Conservatives.  The other big story will be whether
    the NDP can build on its improved standing in public opinion and
    win enough seats to form the government.  END COMMENT.
    HILL

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