The 2016 federal budget tabled recently by Finance Minister Bill Morneau provides a high volume of commitments on a high volume of spending portfolios.
However, as the Canadian Chamber of Commerce noted, it is a budget that is spread too thin.
There are investments in skills development however the cancellation of small business tax reductions could negatively impact future hiring decisions for many employers here in Waterloo Region and across Canada.
A high level of concern has also been expressed from the business sector, and other stakeholder groups, regarding the deficit in the budget and the time it will take to return to a balanced position.
Placing money on our collective credit card in the short term can be acceptable if a plan is in place on repayment.
Prime Minister Trudeau and Minister Morneau should maintain their promise to balance the budget during this term of parliament.
On a positive note for the local economy, the budget commits up to $2 billion over three years for infrastructure renewal at Canadian universities and colleges through the new Post-Secondary Institutions Strategic Investment Fund.
This program is similar to the Knowledge Infrastructure Program (KIP) introduced in 2009 which provided significant funding for Conestoga College and the two local universities.
Our Chamber, recognizing the importance of local post–secondary institutions to the Waterloo Region economy and the strong relationship between them and local businesses for developing the skills to meet employer demands, has been a strong advocate for continued funding for campus infrastructure.
We provided numerous submissions to both the Ontario and federal governments seeking their support.
Through KIP funding Conestoga College has significantly increased their capacity, among other portfolios, in health care and building trades, two areas that are chronically challenged for skilled employees.
Colleges and Institutes Canada, a national association, has identified more than 1,000 projects totaling $7.6 billion that should be able to utilize these infrastructure funds once they are formally available.
Connected with the funding for post-secondary infrastructure is a related commitment for a federal Innovation Agenda within the next year to guide business and government efforts in research and development.
A central focus will be the advancement of Canada’s incubators and accelerators for small technology based businesses, indicating that Waterloo Region will be central to this new initiative.
Overall the Canadian Chamber graded the budget at a B-.
While some investments should provide reasonable returns, a debt cloud is still highly visible on the horizon.