Ontario\u2019s Liberal government tabled an election-year budget on Wednesday that offered more than $900 million in financial support for businesses and job training, a move that comes as Canada\u2019s most populous province grapples with economic uncertainty at home and abroad.<\/p>\n
Premier Kathleen Wynne\u2019s government used their latest, and possibly last, fiscal blueprint to call for $20.3 billion in new spending over three years, including a new \u201cGood Jobs and Growth Plan\u201d that comes with $935 million in new investments that aim to support businesses, bolster worker training and attract jobs.<\/p>\n
The budget comes as export-heavy Ontario awaits the outcome of the North American Free Trade Agreement negotiations and grapples with the economic effects of tax reform in the United States.<\/p>\n
It also comes just months before Ontarians go to the polls on June 7.<\/p>\n
\u201cDespite Ontario\u2019s solid economic underpinnings, there are a number of risks and challenges that could adversely affect the province\u2019s competitiveness and economic growth, including recent tax reform in the United States, trade negotiations and other protectionist measures; high household debt; and the housing market,\u201d the budget said.<\/p>\n
After estimated GDP growth of 2.7 per cent in 2017, the Liberal government\u2019s budget projected 2.2 per cent growth in 2018, 1.8 per cent in 2019 and 1.9 per cent for 2020.<\/p>\n
The budget also projected that the province\u2019s job creation would slow from 121,000 positions in 2018 to 77,000 in 2019 and 62,000 in 2020. That is expected to drive the unemployment rate down to 5.4 per cent by 2021, compared to a\u2028 17\u2010year low of 5.5 per cent in February 2018<\/p>\n
While the budget said U.S. tax reform \u201cmay lessen Ontario\u2019s competitiveness and weaken business investment,\u201d there was no cut to the province\u2019s corporate rate.<\/p>\n
Wynne\u2019s government previously lowered the province\u2019s small business rate in January by 22 per cent in the face of minimum wage hikes. The combined federal-Ontario general corporate tax rate is still 26.5 per cent, the budget noted, making it the lowest in Canada after the previous Liberal regime cut Ontario\u2019s general corporate rate.<\/p>\n
\u201cIn the United States, they tried to basically catch up to what we\u2019re doing in Ontario,\u201d said Ontario Finance Minister Charles Sousa, who also touted the budget\u2019s support for business.<\/p>\n
Sousa said that the uncertainty around the NAFTA talks had given them pause, noting Ontario\u2019s economy is closely linked to the U.S. But Sousa also said the Liberal government\u2019s spending on health and education were an \u201cattraction\u201d for foreign investors, and the Wynne government passed legislation in March that allows for measures to retaliate against \u201cBuy American\u201d policies.<\/p>\n
As part of the \u201cGood Jobs\u201d plan, the government proposed to \u201crenew, enhance and extend\u201d a fund used for supporting business investment with $900 million in potential support for businesses over the next decade. The so-called Jobs and Prosperity fund has previously been used to earmark tens of millions of dollars in grants and loans for automakers and other companies looking to invest in Ontario.<\/p>\n
Region-specific funding was included. According to the budget, the Southwestern Ontario Development Fund and the Eastern Ontario Development Fund would receive an additional\u2028 $100 million over the next \u202810 years, a new Greater Toronto and Hamilton Area fund would be created with $100 million over the next decade, and another $5 million would go to a fund that will help communities left struggling after the loss of a major employer.<\/p>\n
The Liberal government telegraphed the move in a Throne Speech earlier this month, after the provincial parliament was prorogued by the Grits.<\/p>\n
\u201cRecognizing that some parts of the province have particular struggles and challenges with achieving economic growth in this period of transition, the Budget will support regional investments and job funds,\u201d said the speech.<\/p>\n
On the skills front, one of the things the Liberals said they would do is invest $63 million to create the Ontario Training Bank, \u201ca one-stop shop for employers, job seekers and workers to access the skills training that meets their needs.\u201d The government is also pumping $170 million over three years into a new apprenticeship strategy.<\/p>\n
In addition, the Liberal government said it is studying a strategy for intellectual property that will \u201censure that firms leverage their IP to commercialize and grow their businesses here in Ontario and globally while remaining competitive.\u201d The budget noted that some countries have tax incentives connected to intellectual property, which the government said they are reviewing to \u201cdevelop an incentive that works best for Ontario.\u201d<\/p>\n
The budget proposed to expand two research and development tax credits for businesses, with the government saying corporate spending on R&D in the province has fallen in recent years and still lags competitors. The tax credit changes are estimated to cost the province a combined $235 million over three years.<\/p>\n
As promised, the Ontario Liberals followed through on their previously announced plan to run a deficit in the budget, projecting a $6.7-billion shortfall for 2018-19 after an estimated $642-million surplus for 2017-18. Under the Liberals\u2019 plan, there would not be a return to a balanced budget until 2024-25, and net debt for 2018-19 is anticipated to climb to $325 billion.<\/p>\n
Financial Post<\/em><\/p>\n Email: gzochodne@nationalpost.com | Twitter: GeoffZochodne<\/em><\/p>\n","protected":false},"excerpt":{"rendered":" Premier Kathleen Wynne’s government calls for $20.3-billion in new spending over three years, as Ontario awaits the outcome of NAFTA talks and grapples with the effects of U.S. tax reform<\/p>\n","protected":false},"author":578,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[],"tags":[],"jetpack_featured_media_url":"","_links":{"self":[{"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/posts\/2651"}],"collection":[{"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/users\/578"}],"replies":[{"embeddable":true,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/comments?post=2651"}],"version-history":[{"count":2,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/posts\/2651\/revisions"}],"predecessor-version":[{"id":2662,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/posts\/2651\/revisions\/2662"}],"wp:attachment":[{"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/media?parent=2651"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/categories?post=2651"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/tags?post=2651"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}