Uncertainty needs to be cleared up

If there was ever a time of uncertainty about financing junior minin g companies, it’s the last quarter of 1987.

Did Michael Wilson’s white paper on tax reform spell the end of flow-through? Will changes to capital gains exemptions make the potential return from high risk mining stocks worthwhile? Are juniors still welcome on the Toronto Stock Exchange after the stock market crash of Oct 19? Will the earned depletion allowance be 33% or 16% or zero? Many in the industry are wondering just what is going on.

If there was any doubt about the interest and bewilderment of people “out there” beyond the legislative buildings and Bay Street office towers, a church-basement meeting in Val d’Or, Que., last week was convincing proof. About 800 people showed up, concerned about the political disarray regarding the industry.

These are good times for miners and mining communities, but only in spite of governments’ policies not because of them. The only clear thing about governments’ attitude to the industry is that they’re not very clear about anything at all.

We should be thankful for small favors, and we are. Flow- through has been extended by the federal government for another half-year (until the end of 1988) and perhaps then it won’t be killed entirely. But who knows?

And staff at the Ontario Securities Commission say they are eager to implement a new policy for junior financing. But, eager or not, who knows how long that will take? The OSC is still using as a guideline a policy on junior resource financing it revoked in 1983.

The business of finding and developing mines is fraught with enough uncertainty. It shouldn’t be further complicated by an uncertain fiscal policy.