David Coon, MLA/Député

Author by: JOHN CHILIBECK Legislature Bureau
Photo by: JOHN CHILIBECK Legislature Bureau

I was as surprised as anyone else, given the business news about Sears at the time, that they would engage to bring the company to New Brunswick and open call centres. – David Coon

Officials announce the opening of an Edmundston call centre in this January file photo, including, from left, Stephen Lund, CEO of Opportunities NB, Leigh Lampert, vice-president of Sears Canada, Premier Brian Gallant, Economic Development Minister Francine Landry and Edmundston Mayor Cyrille Simard. Sears announced it was going out of business Tuesday.

FREDERICTON • New Brunswick’s Liberal government says it won’t lose any of the $4 million it had earmarked for Sears Canada, which announced Tuesday it was going out of business.

In a prepared statement, Francine Landry, the minister responsible for Opportunities New Brunswick, said her government “was thinking of affected employees” at two business service centres that only recently opened in Edmundston and Saint John to handle calls for the retail giant.

Sears Canada said Tuesday 380 workers between the two call centres would lose their jobs.

“This is a very unfortunate situation and we will work closely with the company and the affected employees during this transition period,” Landry said in the statement. “Opportunities New Brunswick has not advanced any government funds to Sears Canada and has no plans to advance any funds to the company.”

Sears Canada issued a press release earlier Tuesday stating it was going out of business and would seek court approval to liquidate all its assets. About 12,000 employees across the country are expected to lose their jobs.

In two announcements earlier this year, Premier Brian Gallant, Landry and Stephen Lund, the CEO Opportunities New Brunswick, heralded the creation of 180 jobs in Edmundston and another 350 in Saint John at the two new call centres.

The deal was largely tied to payroll rebates, according to officials at the time. However, later in the summer, Landry said up to $2 million of the $4-million deal would likely be paid out before the rebates came back.

The statement issued Tuesday was clear that the money was never sent to Sears Canada.

The premier’s office declined an interview request Tuesday, and Lund wasn’t made available.

In earlier interviews, the CEO said it was worth taking a risk on the retailer, arguing most deals forged by the Crown corporation would pay off for taxpayers in the long run, even if the Sears deal didn’t.

The auditor general’s report released last week said the provincial government had provided $313 million to various companies over the last two years in exchange for creating jobs, including $95 million pledged by Opportunities New Brunswick.

Sears Canada spokesman Vincent Power on Tuesday said in an email 380 people were working at the two centres. It hadn’t filled all 530 positions yet.

“When terminations will take place has not yet been decided. No monies from the government have come to Sears yet.”

Landry said the provincial Department of Post-Secondary Education, Training and Labour, Opportunities New Brunswick, and Contact NB, the association that represents call centres in the province, would work closely with Sears Canada employees in Edmundston and Saint John to direct them to support services in the region for what she called “career transitioning.”

Progressive Conservative opposition leader Blaine Higgs said his first thought was for the thousands of displaced employees across Canada, many of whom had spent their entire career with Sears.

“Despite all the economic indications that have been predicting the demise of this retail giant, the Gallant government thought it prudent to provide economic assistance to set up call centres,” Higgs said in a prepared statement Tuesday. “If all of the auditor general’s recommendations had been in place, would it have resulted in better decisions being made in this situation? At what point does Premier Gallant invest in New Brunswick’s future, as a priority, over his own?”

The premier’s office did not respond for comment on Higgs’ statement.

New Brunswick’s Green Party leader said he still couldn’t figure out why a deal was forged with Sears when its problems had been well publicized for years.

“It seemed bizarre. I read the business news just like Stephen Lund does, and I don’t quite understand why he and his staff thought it was a good bet for New Brunswick, especially considering their mandate is supposed to be about attracting high-growth businesses.”

Coon said given the plight of Eatons, Zellers and Target Canada, which all went bust in recent years, it should have been obvious to the government that retail was a risky sector.