Budget raises tax for 1 in 5 new Ontario homes March 30, 2009
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About one in five new homes built in Ontario will see a six per cent price increase next year because of the provincial government’s plan to merge the provincial sales tax and GST, says Mike Collins-Williams, policy director for the Ontario Home Builders’ Association.
The province and federal government have agreed to harmonize the provincial sales tax and GST into a single 13 per cent sales tax by July 1, 2010, the province confirmed in Thursday’s budget. The merged tax will replace the existing retail sales tax.
That would have the effect of boosting the tax on new homes (resales are excluded) by six per cent, the budget said.
For homes priced under $400,000, the province is proposing a rebate to offset the tax increase. For homes priced between $400,000 and $500,000, there will be a partial rebate. The details have not been released yet.
The government said the rebate would be worth about $1.1 billion a year to buyers of new homes.
Ontario new home sales 2008
Price Per cent of sales
Under $400,000 54.7
$400,000 to $500,000 22.6
Over $500,000 22.7
OHBA, citing federal statistics
Based on federal statistics for 2008, Collins-Williams said 22.7 per cent of new homes in Ontario sold for over $500,000, approximately the same number cost between $400,000 and $500,000, and slightly more than half were under $400,000.
But with the wide variations in home prices across the province, the effect will vary by community. In general, more homes in Ottawa and Toronto, where prices are higher, will be caught by the combined tax.
It is almost certain that more home sales will trigger the higher combined tax as time passes, because prices have gone up over the long term, the association said.
“Inflation and rising home prices will erode affordability over time as fewer and fewer new homes qualify for a rebate, making new homes priced over $500,000 among the most heavily taxed products,” association president Frank Giannone said in a news release.
Collins-Williams pointed to the example of the federal goods and services tax, introduced in 1991. When it began, houses priced under $350,000 were exempt, and those under $450,000 got a partial break. The federal government said those figures would be indexed, but “that hasn’t happened.”
Many more home sales attract GST today because prices have risen.
He said builders looking at a house with a planned sale price of $410,000 might cut its size or reduce the amenities to duck the tax. Likewise, consumers may adjust their behavior.
“You might be budgeting $399,0000 and no more.”
Quebec budget predicts 4 years of deficits March 20, 2009
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The Quebec Liberal government on Thursday tabled a budget with a $3.9-billion deficit, suspending its own balanced-budget law in an attempt to protect the province’s economy from slipping too far into a recession.
The Quebec government tabled a budget Thursday and said deficits over the next four years are expected to add $12 billion to the province’s debt.(Quebec Finance Department)
Finance Minister Monique Jérôme-Forget presented a $66-billion budget for 2009-2010, adding Quebec to the growing list of provinces that are borrowing money to pay for basic services and economic stimulus measures.
Quebec’s deficit, the first in a decade, represents 1.3 per cent of the province’s gross domestic product.
Quebec will not only post a deficit this year, but likely for three more years, said the finance minister.
The deficits are expected to add $12 billion to the province’s already heavy load of debt.
In order to return to balanced budget territory, the province plans to tighten government spending while digging into the pockets of Quebecers.
Not only will all user fees, except daycare, be indexed to inflation, but the Liberal government will do something it promised it wouldn’t: raise taxes.
Beginning Jan. 1, 2011, when the finance minister hopes the recession will end, the government will add one per cent to the Quebec sales tax, bringing it up to 8.5 per cent.
“It’s not a popular move. I’m not going to become popular with that, but it is a decision that is courageous and responsible,” said Jérôme-Forget.
The increase in user fees such as for licences issued by the province will come into effect at the same time.
Economy takes priority
The Quebec government is placing jobs and businesses front and centre in its economic stimulus plan.
The economic measures add up to $15 billion, with $3.4 billion of that for new measures not previously announced.
‘This budget gives hope. It will enable Quebec to bounce back as soon and as high as possible once recovery begins.’? Monique Jérôme-Forget, Quebec finance minister
The new measures include a $500 million emergency fund for struggling companies and another $500 million to help laid-off workers retrain or upgrade their skills.
In an effort to raise capital for businesses, the government is teaming up with the FTQ Solidarity Fund, the investing arm of the province’s labour federation, and the province’s pension fund manager, the Caisse de dép ô t et placement du Québec .
Economic Development Minister Raymond Bachand said the $825 million venture capital fund will give businesses what they are asking for.
“If we want to protect our jobs, companies need access to liquidities,” said Bachand. “If companies don?t have access to liquidities in credit, there?s a major problem.”
The government is also bringing back an old idea with a stock savings plan to promote private investment in Quebec-based businesses looking for capital. Individuals who invest in the stocks will be granted a tax deduction of 150 per cent until the end of 2010 and 100 per cent thereafter.
With additional funding for forestry, infrastructure and energy development, Jérôme-Forget expects to be able to create 100,000 jobs in the upcoming years.
“This budget gives hope. It will enable Quebec to bounce back as soon and as high as possible once recovery begins,” she said.
Opposition left wanting more
The Quebec government’s budget documents include a history of deficit spending.(Quebec Finance Department)Opposition parties pounced on the size of the stimulus package, which they described as miniscule compared to strategies announced in the United States and England.
“What we have here is a mini-plan for the economy,” said Parti Québécois finance critic François Legault.
“This is our worst-case scenario. We have a large deficit and no plan to relaunch the economy.”
The government should have invested more money in education to arm current and future workers with the skills they need to succeed, he said. The government introduced a modest increase to the education budget of 3.5 per cent ($490 million), with the money only going to address the high school dropout rate.
The Action Démocratique du Québec criticized the decision to increase the sales tax, which MNA François Bonnardel said will affect families ? regardless of the finance minister’s assurance that it will only be introduced after the economy rebounds.
“The tax increase is not a good decision,” he said. “We don’t see any way that the middle class ? [will] be protected.”
‘Making the best out of a bad situation’
Economists and other financial experts aren’t sure the economic stimulus plan will produce major results.
Michael Tinkler, a management accountant, said the province has few resources and tools at its disposal to effectively ramp up the economy. Instead, he said, the $15 billion economic stimulus package includes money from private enterprise, other levels of government and investment funds.
“This is a budget that is making the best out of a bad situation,” said Tinkler.
He wonders about a clause in the budget that refers to “other measures” that the government anticipates will help it return to zero-deficit status within five years. He remembers what it took to get Quebec out of a series of deficits in the 1990s: massive cuts to education and health.
“There is another shoe waiting to drop,” said Tinkler.
The Liberal government holds 66 seats in the national assembly, a majority that allows it to avoid last year’s tense situation in which the budget was only narrowly adopted by what was then a minority legislature.
The budget will go through several readings before a vote later this spring.
Big property tax cut highlights Saskatchewan budget March 19, 2009
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Saskatchewan will cut education property taxes by 14 per cent and boost spending by more than $1 billion, according to a provincial budget that shows few signs of the economic storm battering the rest of Canada.
While other provinces are looking at hefty deficits amid the economic slowdown, Saskatchewan will take in $400 million more than it spends in 2009-2010, according to the budget released by Finance Minister Rod Gantefoer on Wednesday.
Saskatchewan Finance Minister Rod Gantefoer said his $10B budget shows sound fiscal management, but the Opposition says it’s unsustainable in the long term.(CBC)
“Let us be strong and steady,” Gantefoer said. “By remaining sound fiscal managers, we will stay the course.”
However, NDP finance critic Harry Van Mulligen said the budget is built on “blind optimism,” ignores signs that the economy is slowing and isn’t sustainable over the long term.
“Strong and steady…we think this budget is wrong already,” he said.
The centrepiece of the budget is the government’s long-term solution to complaints of high education property taxes, an issue that has been particularly controversial in rural Saskatchewan.
The province says property owners will pay $103 million less in education taxes than they did last year, with an additional $53-million reduction promised in 2010.
For a Regina home with a taxable assessment of $100,000, the savings would be $457 in 2010, the government said.
090318.jpg "Big property tax cut highlights Saskatchewan budget")
In a small town like Canora, the savings would be even greater. A home with a taxable assessment of $79,800 would see a $785 tax reduction in 2010, a 51 per cent cut.
Groups representing businesses praised the cut.
“We’re pretty pleased,” said Steve McLellan, CEO of the Saskatchewan Chamber of Commerce. “There’s still an imbalance between what a residential property pays compared to a business ? in some cases, double. I think there’s an opportunity to move there.”
Shift in tax burden
The property tax cuts, combined with a $241-million increase in provincial grants to school boards, will result in a shift in the tax burden between the province and property taxpayers. Last year, the province paid 51 per cent and property owners paid 49 per cent.
090318.jpg "Big property tax cut highlights Saskatchewan budget")
This year, the province will be shouldering 63 per cent of pre-kindergarten-to-Grade-12 costs, while ratepayers will pay 37 per cent. It’s the kind of shift school boards have been after for more than a decade.
There’s another major change to school financing being introduced that may prove to be more controversial ? a provincewide set of mill rates.
Once implemented, public school boards will no longer be able to set their own taxation rates. Catholic school boards will retain that right, but with a catch ? if a school board’s rate is higher than the provincial rate, money will be deducted from their provincial grant.
Roy Challis, the president of the Saskatchewan School Boards Assocation, said he expected some school boards will be upset about losing their autonomy. Having the ability to set school taxes is important because it lets boards respond to their local needs, he said.
Municipalities get piece of PST
Cutting education taxes was one of two major Saskatchewan Party campaign promises Gantefoer pledged would be addressed in Wednesday’s budget, his second since the 2007 election.
The other big item is a new system for sharing provincial government revenues with cities, towns and rural municipalities.
Local governments have long lamented that revenue-sharing has been an ad hoc affair. But starting this year, municipalities will be getting a guaranteed slice of the provincial sales tax.
Saskatchewan’s PST is five per cent, and municipalities will get one of those percentage points, phased in over two years.
It translates into a hefty increase. This year, municipalities will get $167 million in revenue sharing, under the new formula, up $32 million from last year.
090318.jpg "Big property tax cut highlights Saskatchewan budget")
Allan Earle, the president of the Saskatchewan Urban Municipalities Association, was delighted with the news, adding he had trouble sleeping Tuesday night in anticipation. Earle, who is also the mayor of the town of Dalmeny, said people in town will also be happy about the education tax cut. However, the local school board will not be happy losing its ability to set tax rates, he said.
Overall, government spending is estimated to grow by 12 per cent this year, reaching $10.2 billion, compared to the $9.1 billion estimated last year.
As usual, health accounts for the largest share of spending ? 40 cents out of every dollar the province takes in.
The $4.1-billion health budget is up nine per cent from last year.
Saskatchewan is spending $200 million over two years toward construction of a children’s hospital that will be built next to Saskatoon’s Royal University Hospital.
Capital spending for such things as roads, bridges, and other provincial works, like schools, will hit $1 billion this year, adding to the record $1.5 billion approved last year.
Revenues rising
While spending is way up, so are projected revenues, vaulting from an estimated $9.4 billion to $10.7 billion.
Following a year of plummeting oil prices, oil revenues are expected to be down considerably, but the loss will be more than balanced by a historically large jump in potash revenues.
For the first time ever, the province is taking in more in potash revenues, $1.9 billion, than it is in income tax, $1.8 billion.
The government says it has a balanced budget and will not need to dip into its Growth and Financial Security Fund, often called the government’s rainy-day fund.
The fund will have $1.1 billion in the 2009-2010 fiscal year that begins April 1.
However, in subsequent years, the province expects to draw down on the fund, taking out about $400 million by 2012-2013.
While Canada was in the grips of a recession in 2008, the Saskatchewan economy grew 3.7 per cent.
The budget documents forecast that the provincial economy will continue to expand, with 2.1 per cent gross domestic product growth in 2009 and 2.9 per cent in 2010.
Van Mulligen challenged those numbers. He said recent private-sector forecasts from the big banks suggests growth will be well below one per cent this year. He also questioned the potash revenue projections, adding that recently Potash Corporation of Saskatchewan has cut back production and extended layoffs in the mines.
Flaherty urges senators to pass budget bill March 11, 2009
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‘I urge you to pass the [budget implementation] bill without delay,’ said Finance Minister Jim Flaherty, shown preparing for his appearance before the Senate finance committee in Ottawa on Tuesday. (Tom Hanson/Canadian Press)
Finance Minister Jim Flaherty is calling on members of the Senate finance committee to pass the budget implementation bill quickly to bolster the weakened Canadian economy.
“I urge you to pass the bill without delay,” Flaherty said Tuesday, urging committee members to pass the bill before leaving for March break holidays next week. “Do not dally.”
Flaherty pointed out that February unemployment numbers due out Friday from Statistics Canada will be a sign of the economy’s current state.
“These numbers are not likely to be good,” he said.
In January, Canada lost 129,000 jobs, leading to a rise in the unemployment rate to 7.2 per cent. The Canadian economy contracted in the fourth quarter of 2008, with gross domestic product shrinking at an annualized rate of 3.4 per cent.
Flaherty sparred with Liberal members of the committee, who called on him to divide the bill between economic stimulus measures and non-stimulus moves.
In addition to the stimulus measures, the budget implementation bill also includes changes to pay equity for civil servants, and to acts concerning navigable waters and industry competition.
“You’ve thrown in the kitchen sink here,” said Liberal Senator Art Eggleton.
Obama unveils $3.55 trillion budget, says ‘hard choices lie ahead’ February 28, 2009
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U.s. President Barack Obama, flanked by Budget Director Peter Orszag, right, and Treasury Secretary Tim Geithner, talks about his proposed 2010 federal budget on Thursday in Washington.(Charles Dharapak/Associated Press)
U.S. President Barack Obama unveiled a $3.55 trillion US fiscal plan that will hike taxes on the wealthy, revamp Medicare and saddle the country with a massive deficit.
As part of the effort to pull the United States out of a crippling recession, the administration proposes boosting the deficit by an additional $250 billion US this year. That would enable the $750 billion US in increased spending under the government’s rescue program for banks and other financial institutions. The increased spending more than doubles the $700 billion bank bailout passed by Congress last October.
Obama predicts a whopping $1.75-trillion deficit in the current budget year, a figure 50 times the size of Canada’s deficit.
Obama’s fiscal plan will also ask Congress to raise taxes on the wealthy in 2011 and cut Medicare costs to provide health care for the uninsured. Private insurance plans serving Medicare seniors would take the biggest hit.
Obama said the cuts are needed to kick-start an effort to cover all uninsured Americans.
“We must make it a priority to give every single American quality, affordable health care,” Obama told a press conference ahead of presenting his plan to Congress.
“Having inherited a trillion-dollar deficit that will take a long time for us to close, we need to focus on what we need to move the economy forward, not on what’s nice to have,” he said. “There are some hard choices that lie ahead.”
Obama said Thursday he will slash spending by $2 trillion.
“We have targeted almost $50 billion in savings by cracking down on overpayments of benefits and tax loopholes ? that is money going to businesses and people to which they are simply not entitled,” he said.
“And we’ll save billions of dollars by rolling back tax cuts for the wealthiest Americans, while giving a middle-class tax cut to 95 per cent of hard-working families.”
Going into debt in the short term will help restore American business vitality, but Obama said lowering the debt in the longer-term would be the only responsible approach to the country’s fiscal policies.
The blueprint is a 140-page outline, with a fully fleshed out version scheduled for release in April.
But it is only a proposal, which must get approval from Congress, where it is expected to spark fierce debate.
“This budget plan is once again a missed opportunity for American taxpayers,” said Judd Gregg, the top budget committee Republican who was nominated by Obama to join his cabinet as commerce secretary but then withdrew. “It raises taxes on all Americans, implements massive new spending and fails to make any tough choices to control the deficit.”
Among the highlights of the budget:
Health careTrim health-care spending ? which stands at $2.4 trillion a year ? and divert those resources to create a 10-year, $634-billion reserve fund to expand coverage for 48 million uninsured Americans.About half of the fund’s resources would come from cuts in Medicare ? scaling back payments to private insurance plans that serve older Americans, and charging upper-income beneficiaries a higher premium for Medicare’s prescription drug coverage. To raise the other half of the reserve fund, the budget would reduce the rate by which wealthier people can cut their taxes through deductions for mortgage interest, charitable contributions, local taxes and other expenses to 28 cents on the dollar, rather than the 35 cents they can claim now.TaxesExtend the $400 annual tax cut due to start showing up in workers’ paycheques in April, and extend the tax cuts passed in 2001 and 2003 for couples earning less than $250,000 per year. Those tax cuts were due to expire at the end of 2010.Raise income taxes and curb deductions for couples making more than $250,000 a year beginning in 2011, which would allow their marginal rate to rise from 35 per cent to 39.6 per cent.Raise taxes on wealthy hedge fund managers and corporations.Eliminate tax incentives U.S. companies now have to move jobs overseas.Phase out direct payments to farming operations with revenues above $500,000 a year.MilitaryAn additional $75 billion will cover the costs of wars in Iraq and Afghanistan through September, on top of $40 billion already being spent. An extra $130 billion for Iraq and Afghanistan in 2010 and $50 billion annually is budgeted to cover the costs of operations in Iraq and Afghanistan.Climate Change$15 billion a year over 10 years to develop technologies such as wind and solar power, and to build energy efficient cars and trucks.Hundreds of billions of dollars would be raised by auctioning off permits to exceed carbon emission caps, which would be imposed on users of fossil fuels to address global warming. Some revenues from the pollution permits would be used to extend the “Making Work Pay” tax credit of $400 for individuals and $800 for couples beyond 2010.With files from the Associated Press (more…)
MPs approve federal budget February 5, 2009
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Finance Minister Jim Flaherty receives a standing ovation from Conservative caucus members after voting in favour of the federal budget in the House of Commons on Tuesday.(Tom Hanson/Canadian Press)
The House of Commons passed the Conservative government’s budget Tuesday night by a 211 to 91 vote, ensuring the government’s survival.
The NDP and Bloc Québécois voted against the budget, while most of the Liberal party supported the Conservatives’ financial plan.
All six Liberal MPs from Newfoundland and Labrador voted against the budget. Four of them ? Scott Andrews, Siobhan Coady, Judy Foote and Scott Simms ? had argued the budget singles out their province and robs it of an estimated $1.6 billion in federal transfer payments. They said they would be breaking party ranks and opposing the budget in the vote.
The NDP clapped as the Newfoundland and Labrador MPs registered their nay votes while the Conservatives heckled them from across the floor.
There was little reaction from the Liberal members. Earlier Tuesday, Liberal Leader Michael Ignatieff said that he would allow the MPs from the province to break party ranks and have a one-time-only protest vote against the budget. Gerry Byrne and Todd Russell then joined their Liberal colleagues from the province and registered a vote against the budget on Tuesday night.
The budget promises billions of dollars in new spending ? ranging from money for infrastructure projects to aid for worker training and cash for enhanced employment insurance benefits ? to help the country ride out the global economic slump.
The budget forecasts a federal deficit of $33.7 billion for the 2009-10 fiscal year and $29.8 billion the following year.
The bill included a Liberal amendment, which passed through the House on Monday in a 214 to 84 vote. The NDP and Bloc also voted against it.
The amendment requires regular reports to Parliament on the budget’s implementation and costs. The reports are expected in March, June and December.
Each report would be an opportunity for the Opposition to express confidence in the government, Ignatieff said last week.
The Conservatives required the support of the Liberals to ensure the budget bill passed.
A defeat would have toppled the minority Tory government and possibly led to some kind of coalition government or another election.
Budget lacks vision for broadband, critics say February 3, 2009
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Critics say the federal government’s $225-million commitment to encourage the development of broadband internet connections to rural and remote areas would fall short of its goals if it isn’t backed up by further commitment and an accompanying vision of the future.
In last Tuesday’s budget, the federal Conservatives pledged $225 million over three years to Industry Canada to develop and implement a strategy to extend broadband coverage to all underserved communities beginning in 2009-10.
“The government is committed to closing the broadband gap in Canada by encouraging the private development of rural broadband infrastructure,” the government said in its budget statement.
The government has said it has to subsidize the private sector to deliver broadband because many communities have too few people or are too far from cities for companies to make a profit on the service.
John Reid, president and CEO of the Canadian Advanced Technology Alliance, said the $225-million commitment is a worthy objective, but called the funding “modest,” particularly compared with the efforts of competing nations.
Australia, for example, committed to an ambitious $4.7-billion AU plan to upgrade its broadband infrastructure in December.
And last week, the U.S. House of Representatives passed an $819-billion US economic stimulus package that includes $6 billion US in funding to stimulate broadband deployment across the U.S. The package includes a $2.8-billion US grant program for broadband providers to roll out service to rural and other underserved areas.
Canada’s budget funding falls short of the Conservative party’s own election promise of $500 million over five years, said Michael Geist, an internet law professor in Ottawa. The commitment is for $75 million instead of $100 million a year, although Geist notes the government did appear to move the implementation date up a year from 2010-11 to 2009-10.
The Conservatives, during the 2008 election campaign, also said the private sector and other levels of government would have to match the federal money to pay for the project, which would come at a final cost of $1.5 billion by 2016.
“To call this commitment modest is being charitable,” Geist said. “I don’t know what the right number for Canada is, but what we needed was a firm commitment to universal broadband ? and this falls short.”
Reid said committing a higher dollar value is less important than having a plan to back it up, and said the many budget pledges to support technology industries lack vision.
“I think an opportunity was missed to show Canadians how these expenditures will help the country,” said Reid. “The context was weak. It’s not enough to say we’ll match what other countries are doing; you need to explain why.”
Broadband has its benefits
Extending broadband, for example, could allow for delivery of medical information electronically, a powerful tool for people living in remote communities, he said.
Geist said the payoff for providing universal broadband would be also be in allowing the government to roll out some services almost exclusively online instead of having to provide and maintain multiple methods of service delivery at added expense. But he said these benefits are rarely discussed when broadband spending is addressed.
Canada once held a position as a global broadband leader. It ranked second in 2002 behind South Korea in the number of broadband subscribers per 100 inhabitants, according to data from the Organization for Economic Co-operation and Development.
But that lead has dwindled, as other countries have caught up and outpaced Canada in growth in the last five years. Canada now ranks 10th according to the latest OECD figures from June, with 27.9 subscribers per 100 inhabitants. Denmark leads the 30 OECD countries with 36.7 subscribers per 100 inhabitants.
And while Canada retains its position as the most-connected country among G7 nations, that lead is dwindling, with the United Kingdom trailing close behind at 27.6 subscribers per 100 inhabitants and, at current growth rates, expected to pass Canada in 2009.
Liberals on top of Tory plan
Where Canada trails other countries considerably is in the pricing of its broadband services.
Canadians pay an average of $28.14 US in monthly price per advertised megabit per second, according to 2007 figures from the OECD. Only Greece, Mexico and Turkey have higher costs per Mbit/second among the 30 OECD nations surveyed.
Liberal science and technology critic Marc Garneau told CBC News he couldn’t say whether the $225 million over three years is significant enough to keep Canada connected, but said it represented a start in the right direction.
“I think it will go some way towards the goal,” Garneau said.
But he said the real test for the government will be in how quickly and efficiently the program delivers the service.
“We are going to be watching this government very carefully,” he said. “What we want to see is how much goes towards that and how quickly, and does it go into the areas that actually need it.”
Politicians gush, business cautious after federal budget January 29, 2009
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Manitoba politicians are salivating at the prospect of new spending on roads, sewers, museums and stadiums but at least one business owner believes Ottawa’s spending splurge will do nothing to boost consumer confidence.
Manitoba Finance Minister Greg Selinger said that at first blush there was something for everyone in the Harper government’s budget.
“We think that waste water and sewers in Winnipeg and in Brandon are important,” he said. “We think that highways are important. We think that social housing is very important. We think specific signature projects such as the Canadian Museum for Human Rights should move forward. We can look at the football stadium as another signature project, so we have a number of things on the table that we can move on very quickly.”
Manitoba’s NDP government has already identified certain priority projects that it plans to cost-share with the federal government, he said.
“There’s no question that this budget has put resources on the table that will help stimulate the economy across the country.”
No confidence
But small business owner Joe Gupta said he’s disappointed since to him it appears the 2009 federal budget will drive the national government deep into debt and will not boost public confidence in the economy.
And he said measures for small business won’t make much difference to his Winnipeg-based company, India Spice House, because consumers just aren’t spending. Tuesday’s federal budget is not going to reverse public worry about the economy or create an environment where consumers will suddenly start spending again, he predicted.
“There’s a lot of unemployment,” said Gupta. “People are not secure with their jobs and all that. They have a scary feeling and they will buy only what is required.”
‘Heart of the Continent’
Winnipeg Mayor Sam Katz said he’s pleased to see Ottawa will fast-track development of an inland port in the city.
The CentrePort idea is to build on Winnipeg’s reputation as an air cargo, rail and trucking transportation hub in the geographic centre of North America. About 20,000 acres of land around Winnipeg’s James Richardson International airport would be dedicated to building transport and storage terminals.
Katz says it capitalizes on the city’s location at “the heart of the continent.”
“There’s a lot more discussion to go on,” said Katz. “But there’s certainly a fantastic opportunity for us.”
Katz echoed Selinger’s comments ? hoping the budget provisions will open the door to construction of a new football stadium for the CFL’s Winnipeg Blue Bombers at the University of Manitoba.
The mayor said the city has placed a priority on repairing back lanes, bike paths and roads. But he said Winnipeg has yet to determine how projects will be cost-shared between governments before deciding how to proceed.
Treasury Board President Vic Toews, the federal minister responsible for Manitoba, said upgrading a dangerous stretch of the Trans-Canada Highway through Headingley, just west of Winnipeg, was specifically mentioned in the budget.
And he said the federal share of funding for a new football stadium will be easier to find. “[The stadium is] not specifically mentioned but it certainly makes it much easier for me to come up with $15 million of taxpayers’ money,” Toews said.
Calgary businesses, professionals doubt budget will spur spending January 29, 2009
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Some Calgary business people wonder whether the spending plans and tax changes in Tuesday’s federal budget will actually get consumers buying and boost the economy as expected.
Although the tax reductions are welcome, consumers are more likely to save the extra few hundred dollars rather than spend it, said Carlos Santos, who owns a photography shop in the city’s southeast.
The extra $200 to $500 left in people’s pockets is not going to be enough for them to make a major purchase, he said.
“You can’t even buy a refrigerator if you need one, right? Buy a DVD player? Maybe a Game Boy for the kids?” he said.
The billions earmarked for infrastructure as well as the home renovation tax credit may be have more success, but the overall deficit spending is cause for concern, Santos said.
Calgary immigration consultant Gita Boyd said it looks like the government is using the budget to try to buy its way out of the recession.
“I think they’re hoping to get a few more years in government,” Boyd said. “I think it’s not going to do us much good. It’s going to be a burden for my children and grandchildren to repay.”
Calgary tax expert Doug Ng said the budget was clearly focused on stimulus spending, with tax cuts given only secondary consideration.
Although the home renovation tax credit may encourage people to spend, he said, it only helps people who make enough money to pay taxes in the first place.
None of the tax reductions will help people in the near future since they will not kick in until the 2009 tax year, he added.
The budget was a big disappointment and will do little to increase the country’s productivity, said business columnist Deborah Yedlin.
The government failed to take the bold measures needed to aid the economy and to provide a strong vision for the country, she said.
“There’s none of it, and that’s what is really unfortunate,” she said.
The budget didn’t have much for the province’s oil and gas sector, she said. The industry needs access to financing and higher commodity prices to ensure stability.
Unemployed workers get boost in budget January 28, 2009
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Employment insurance and other programs to help Canadians who don’t have jobs would get a temporary boost over the next two years under Tuesday’s federal budget.
“They [the unemployed] will need greater support in this time of recession,” Finance Minister Jim Flaherty said in his budget speech.
The support would include:
Extending funding for workers searching for new jobs and for retraining.Extra help for individuals who have lost their jobs as a result of employers going bankrupt.Additional funding to help younger, older, aboriginal workers and immigrant workers find jobs.EI serves 600,000 a year
Much of the new funding would be funnelled through the existing EI program, which serves about 600,000 Canadians a year, according to Department of Finance figures.
Under the budget, over the next two years, the government would temporarily allow people to claim EI benefits for an extra five weeks, up to a maximum total of 50 weeks a measure expected to cost the government $1.15 billion. EI users living in areas with higher unemployment rates would be eligible for more weeks of benefits.
Air Canada employees protest in front of Pierre Elliott Trudeau Airport in Montreal on Tuesday after the company announced that more than 600 flight attendants are being cut. (Peter McCabe/Canadian Press)
Up to 10,000 people who have worked for a single company or in a single industry for a long time would be eligible to have their benefits extended for an even longer period than 50 weeks while they participate in longer-term training programs. That measure would cost about $500 million over the two years.
The budget also provides help for Canadians at risk of layoffs due to the precarious state of their employers.
The government would spend $200 million over two years to boost work-sharing agreements that would allow workers to receive EI benefits if they work fewer hours while their employers recover.
For workers losing their jobs due to companies going bankrupt, there?s the proposed expansion of the Wage Earner Protection Program ? to cover severance pay owed to eligible employees, at a cost of an estimated $50 million over two years.
The program already covers wages and vacation pay worth up to four weeks of maximum insurable earnings under the Employment Insurance Act.
Some EI benefits could also be extended down the road to self-employed workers. The budget says the government would consult with the public to develop ways to provide EI paternity and maternity benefits to people with their own businesses.
Measures target Canadians in training
The 2009 budget includes some new money for workers training to enter or re-enter the workforce:
$1 billion over two years for training through EI.$500 million over two years to help fund training for individuals who don’t qualify for EI training, such as self-employed people or Canadians who have not worked for a while.$40 million a year to launch a $2,000 grant as an incentive to complete apprenticeship training. About 20,000 people a year who have completed their training would qualify for the taxable grant.$87.5 million a year to boost the number of Canadian Graduate Scholarships, providing funding for 500 more doctoral and 1,000 more master’s students. Of that, $70 million would go to students in sciences and engineering. The remaining $17.5 million would be directed towards students working on business-related degrees.Help for young, older, immigrant, aboriginal workers
Funding would also go to specific groups facing unusually high unemployment to help them land jobs:
Young workers: $55 million over two years to help them find summer jobs.Older workers: An additional $60 million over three years for the Targeted Initiative for Older Workers and its expansion to include workers in more communities.Immigrants: $50 million over two years to help develop a national framework in partnership with provinces and territories that would make it easier for their foreign credentials to be recognized.Aboriginal workers: An additional $100 million over three years for training through the Aboriginal Skills and Employment Partnership, which would be expected to support the creation of 6,000 jobs; and $75 million toward a two-year Aboriginal Skills and Training Strategic Investment Fund for short-term, partnership-based programs (more…)
