Noront Resources

Some positives, negatives — but mostly local skepticism to budget

Queen's Park in Toronto (Reuters file photo)

TIMMINS - There were promises aplenty in the new provincial budget that was introduced in the Legislature in Queen’s Park on Thursday afternoon. Some of them small, some of them will mean sweeping changes to everything from education to industry.

But despite the many financial goodies being offered in the new budget, the reaction from Timmins commercial and political leadership was mixed at best, to downright suspicious at worst.

The Timmins Chamber of Commerce’s reaction was “mixed,” with some of the initiatives being seen as good for local business and industry, while others representing new burdens on employers.

MPP Gilles Bisson (NDP — Timmins-James Bay) said the budget was exactly what he expected from a Liberal government, namely that it offered eye-catching initiatives to distract Ontarians from the things they are not doing, such as supporting the Ring of Fire.

“This is all about the political message, and not necessary about what’s good for Ontario. It’s about what’s good for the Liberal party, not the public,” declared Bisson.

The only mention of the Ring of Fire in the budget is to reiterate the commitment the province made in 2014 to spend $1 billion on the required infrastructure.

This did not surprise Mayor Steve Black, who said he had not expected the province to do anything about the stalled mining initiative.

According to Minister of Finance Charles Sousa, who delivered the budget speech to his fellow MPPs, the 2016/17 budget is expected to run a $4.3-billion deficit, down from $5.2 billion in last year’s budget. Despite billions of dollars being promised in increased spending initiatives over the next several years, Sousa said the province is on track to balance the government’s books by next year.

“This will be the last deficit before we erase it completely by 2017/18,” declared Sousa as the members on the government side erupted with cheers.

Christine Bender, vice-chair of the Timmins Chamber of Commerce said that a return to balance budgets would benefit the business sector in Timmins and across Ontario.

“A commitment to fiscal balance would be wonderful, and would provide some confidence across the province,” she said.

Meanwhile, MPP Bisson said a balanced budget by next year is a noble goal, but said he simply doesn’t trust the numbers the government is putting out.

“I don’t think anyone disagrees with the goal ... but I don’t trust a lot of what they say about the numbers because up to now, none of their numbers have panned out the way the said they would,” said Bisson. “When they made changes to the hydro system, they said rates would go up minimally. Rates have gone up like three times.”

Despite their intention to be deficit-free in a year’s time, their new budget promises new spending over the next several years worth billions of dollars.

One of the most important elements for Timmins is the announcement of more for infrastructure public infrastructure. The province is promising to spend $160 billion over the next 12 years, as well as increasing the Community Infrastructure Fund $300 million per year for municipalities under 100,000 people, such as Timmins.

This includes the extra $5 million for the Connecting Link program this year and the addition $10 million next year.

Mayor Black, who has pushed for extra money for the program for some time, praised the government’s move.

“After a year of being one of the strongest advocates for more funding for the Connecting Link program, I am extremely pleased with the announcement. Having doubled the available funds puts the province in a much better place to cover their share of the Connecting Link costs,” said Black.

The government is also promising to provide hospitals across the province with the first increase to their base in five years by spending an extra $345 million. The Timmins and District Hospital’s board of directors have repeatedly called on the government to end its freeze on funding, which has forced the facility to find more and more ways to cut costs.

Before this announcement, the cost of inflation had brought the hospital to the end of its cost-cutting rope. The board was set next month to report a large deficit in their upcoming budget, which may have required service cuts to keep balance the books as the hospital is required by law to do.

Bisson said that the money the province has announced amounts to an increase of about 1% which will not fix the problems caused by five years of increased costs from inflation. The local MPP believes the Liberals are giving just enough that they can say the didn’t deny the hospitals an increase for the sixth year in a row, but not enough to solve anything.

“They’re still behind the 8-ball, the inflation rates every year were more than 1%,” he said. “This is going to affect services. I’ve been to talking to doctors and surgeons, and they say that surgeries are already getting harder to schedule.”

The government also announced some big changes for trying to figure out how they will pay for university or college. Sousa announced during his speech that Ontario Tuition Grant will be reformed to allow more students with families making $83,000 or less per year to get a grant to cover tuition.

On top of that, anyone from a family whose household income is less than $50,000 will get their entire tuition covered debt-free.

“The reality is that most people in Timmins that have kids with university-aged kids are doing better than $50,000 a year,” said the MPP. “I think this is a bit of smoke and mirrors (to seem like they are addressing the student-debt issue.)”

Bisson said that while this change sounds generous, the $50,000 means very few people in Timmins will be able to take advantage of the free tuition.

But anything that makes it easier for people to get the training they need to fill the supply gaps in the labour market is unreservedly good news in their eyes of the Chamber of Commerce.

“It should help us address some of the shortfalls in skill-sets that we have in the north,” said Bender.

The chamber is less excited about the Liberal’s new pension plan, which according to the Finance Minister, will start collecting contributions from employers starting in 2018, and begin paying out benefits to retirees by 2022.

Nor are they enthusiastic about how Ontario will also be implementing a new cap and trade system, where businesses and other institutions will have a cap placed on how much greenhouse gases they can emit. If they can’t stay under the limit, explained Sousa, they will have to pay for carbon credits.

“All proceeds from the cap and trade program, up to $1.9 billion annually, will be invested exclusively in proscribed programs that reduce pollution and greenhouse gas emissions,” said the minister.

Chamber president Kurt Bigeau said that both these policies represent an increasing regulatory burden that business-owners are always expected to shoulder.

“The Timmins Chamber of Commerce continues to have strong concerns about how businesses are being asked to absorb increasingly higher costs, which we fear will put them at a disadvantage in the national and global economies,” said Bigeau in a statement. “We look forward to working with the provincial government to address these ongoing issues and to encourage meaningful engagement with the business community as they further develop regulatory reforms. Dispelling this environment of uncertainty would benefit the province as a whole and provide some much-needed support for our economy.”

Bisson is also suspicious of the new cap and trade system because he expects it will force businesses to increase prices for consumers, especially when it comes to the region’s already above-average gasoline prices.

“No one is going to disagree that we as a province need to do more about climate change,” he said. “But we need a system that is transparent and will actually lower greenhouse gas emissions.”