NS: Rebates under fire in wake of call centre closure

[HALIFAX, NS] — Eyebrows were raised this week when Convergys announced it was closing its call centre in Truro just as a six-year annual rebate worth as much as $6.5 million expires.

Economic Development Minister Percy Paris said on Thursday he is taking a “very serious look at rebates” to see if they’re worth it. The study is part of an economic development strategy being readied for release in the fall.

Paris said there existed a popular perception that rebates were necessary to keep the province competitive. But he downplayed them as only one possible option, and perhaps one whose time is up.

“I think rebates may be a tool in the toolbox, but I also think tools sometimes get old, get worn out and that’s why it’s important for us to do evaluations,” he said.

Convergys denied the rebate expiry is the reason for the Truro closure, saying simply there was less business. The rebate expires at the end of this month. The plant will close in September.

The tax rebates have been frequently handed out over the last several years as businesses set up shop. The recipients have ranged from weapons manufacturer Lockheed Martin ($1.8 million) to video game developer Longtail Studios ($1 million).

The last payroll rebate to be handed out to a call centre happened last December. Blue Ocean Contact Centres in Halifax got $1.95 million through Nova Scotia Business Inc. to help them hire 350 new people.