NEWS RELEASE
TIMMINS CHAMBER OF COMMERCE
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Though some measures in the 2017 provincial budget may benefit Timmins businesses, the lack of long-term solutions for rising costs for electricity, cap and trade, and debt interest payments is a concern for the Timmins Chamber of Commerce.
The Apr. 27 presentation of the 2017 provincial budget by Finance Minister Charles Sousa proposed several items relevant to the Timmins businesses, including:
- A commitment of $190 billion in infrastructure spending over 13 years, including a continued commitment to increase the Connecting Links Funding program from $15 million to $30 million in 2018;
- Establishing the 2017 budget as a balanced budget, the first since 2008-2009, with commitments to set a trend of balanced budgets in coming years;
- Investing $200 million over three years to support First Nation, Métis, and Inuit learners' access to post-secondary education and training, including $56 million for Aboriginal Institutes;
- Creating a Career Kick-Start Strategy, which invests $190 million over three years to create opportunities for graduates and to create more internships; and
- The previously announced Fair Hydro Plan, which would allow 25 percent rate reduction for some small businesses.
“There are some elements of the 2017 budget that stand to have some positive impact on Timmins businesses, but what's not included is a much greater issue,” said Bender.
“Namely, energy rates continue to be among our members' largest concerns, and while previously announced measures to reduce those rates through the Fair Hydro Plan are certainly appreciated, much more needs to be done. Although some of the announced investments are a step in the right direction, stronger measures must be taken to protect and grow our economy.”
Some positive measures being taken this year include a focus on increasing post-secondary education and training support as a means of addressing workforce shortages -- one of the largest obstacles for Timmins Chamber members, added Bender.
Funding new opportunities for graduates through the Career Kick-Start Strategy will help to tackle this issue, as will the $200 million for First Nation, Métis and Inuit learners' access to education and training.
Similarly, the commitment to increase the Connecting Link funding program to $30 million is welcome, but remains insufficient for communities' needs, said Bender.
This fund assists the 77 municipalities to which the province has downloaded the responsibility of maintaining 350 kilometres of Connecting Links – portions of provincial highways traveling through municipalities.
The cost to repair Timmins' 21.2 kilometres of Connecting Link is estimated at roughly $120 million, but the city was recently refused any funding for its planned 2017 work.
"The budget's lack of specific measures to clarify the use of cap and trade revenues is unfortunate, as these costs represent a major challenge to Timmins businesses’ competitiveness," said Bender. "Ontario's regulatory burden is already quite significant, and careful reinvestment of cap and trade funds could help businesses to reduce their costs under this system. These issues must be addressed, and we look forward to working with the provincial government to undertake measures that will support our businesses and our economy."
The government’s elimination of the deficit in this budget represents a step in the right direction, but there remains no indication of whether Ontario would seek to pay down its debt.
At roughly $318 billion, the province's debt load means that interest payments will consume ever-greater portions of the budget; currently, interest payments are $11.6 billion per year, and represent the province's largest expense. This has already led credit rating agencies to downgrade Ontario’s outlook from stable to negative in recent years.
The Ontario Chamber of Commerce (OCC) shared similar concerns about the growing provincial debt load, which contributes to lower business confidence, according to Richard Koroscil, Interim President & CEO, Ontario Chamber of Commerce.
“Budget 2017 demonstrates that much of Ontario’s fiscal outlook will depend on the prosperity of our private sector,” said Koroscil.
“The government acknowledged that business investment spending slowed in 2016, though expects firms to increase investment by 3.1 percent, annually, to 2020 – an amount that would outpace growth in real GDP growth and household spending. These assumptions depend upon business confidence – which has fallen precipitously in recent years according to the Ontario Economic Report – and U.S. demand, which is subject to considerable risk given recent comments by American President Donald Trump.”
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