November 5, 2015 / 8:00 PM / 2 years ago

UPDATE 2-Canada minister to discuss Bombardier aid issue with officials

(Adds comments by transport minister, background)

OTTAWA, Nov 5 (Reuters) - Canada's newly appointed Innovation Minister Navdeep Bains said on Thursday the topic of possible government aid to aerospace firm Bombardier will be discussed by officials later in the day.

Bombardier's struggles with its CSeries jet project have left the company saddled with debt and looking at a range of options to raise cash.

The province of Quebec, where Bombardier is based, said last week it will invest $1 billion in the CSeries in return for a near 50 percent stake in the project.

Asked about the potential for government subsidies for the company, Bains told reporters, "With respect to that, I'm going to be speaking to my officials later on today."

The question of aid to Bombardier is a sensitive one for the ruling Liberals, who won many more seats than expected in Quebec in the Oct. 19 election. The party could pay a price in the next election if Quebecers feel Ottawa did not do enough to help.

Transport Minister Marc Garneau, who represents a constituency in Quebec, later told CTV television that Ottawa had not been formally approached about possible federal aid.

"We have no idea when the demand or the request may come," he said.

Quebec has already contacted Bains' office regarding an investment in the CSeries, a spokeswoman for the province's economy minister Jacques Daoust said.

While media reports have cited Daoust asking the federal government to match its $1 billion investment, his spokeswoman Melissa Turgeon declined to specify an amount.

"We think the federal government should support the aerospace industry in Quebec like they supported the automobile industry in Ontario," Turgeon wrote in an email. "The scope and details of their contribution, if any, will have to be discussed."

Speaking earlier alongside Bains, Jean-Yves Duclos, the Minister of Families, Children and Social Development who is from Quebec, said that the issue will be looked at by the cabinet as a whole and that ministers responsible should be able to give a more precise answer shortly. (Reporting by Randall Palmer, Leah Schnurr and David Ljunggren in Ottawa and Allison Lampert in Montreal; Editing by Bernard Orr and Chris Reese)

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