2013 federal budget a builder, say industry reps

The construction industry welcomed news of a 10-year infrastructure commitment and a new initiative to increase skilled labour training announced in the 2013 federal budget.

“On balance, we’re back to where we were pre-stimulus, with a little bit more and I think a good foundation to move forward,” said John Gamble, president of Association of Consulting Engineering Companies-Canada (ACEC), of the $70-billion infrastructure commitment over the next 10 years.

This commitment includes $47 billion in new funding over 10 years for a new Building Canada Plan, $7 billion for infrastructure construction on First Nations lands and $10 billion to improve federal infrastructure assets.

The $32.2 billion Community Improvement Fund, contained within the Building Canada Plan, includes the permanent, indexed Gas Tax and the incremental GST rebate for municipalities.

There is a commitment to review the program in five years.

The infrastructure program also provides $1.25 billion over five years on a cash basis to renew the P3 Canada Fund, a move applauded by the Canadian Council for Public-Private Partnerships (CCPPP).

“(P3s) strengthen our economy and provide Canadians with important public facilities that might otherwise not get built,” said CCPPP president and chief executive officer Mark Romoff.

“With guaranteed maintenance requirements, public-private partnerships help ensure that assets last longer and cost less over their lifecycle.”

The Canadian Public Works Association (CPWA), one of the partners in last year’s Canadian Infrastructure Report Card, applauded the government’s infrastructure commitments.

“There has been much done but that the need to maintain our public infrastructure is a key component in maintaining our economic advantage,” noted CPWA president Darwin Durnie.

“[The] announcement by the federal government demonstrates the priority they are placing on Canada’s infrastructure.”

This federal ommitment to infrastructure funding demonstrates the leadership needed on this issue, says The Canadian Home Builders’ Association (CHBA).

“It’s an opportunity to restore fiscal integrity at the municipal level and fairness for younger generations.  At present, many municipalities are financing community infrastructure by transferring the costs into the mortgages of new home buyers, amounting to more than $5 billion a year,” said CHBA president Deep Shergill.

The federal deficit is projected to decline to $18.7 billion in 2013-14 from $25.9 billion in 2012-13. It will continue to decline to $6.6 billion in 2014-15 and a surplus of $0.8 billion is expected in 2015–16. A surplus of $5.1 billion is projected for 2017–18.

Gamble said it is important that the government be financially stable.

“With Minister of Finance Jim Flaherty committing to moving Canada back into a position of financial strength in terms of balanced budget, we hope that might give the government some more flexibility down the road to make even further investment and leverage infrastructure investment,” he said.

The budget introduced the Canada Job Grant, which will provide a possible $15,000 or more per person, including a maximum federal contribution of $5,000 matched by provinces/territories and employers. Businesses with a plan to train unemployed and underemployed Canadians for an existing job or a better job will be eligible to apply for the grant.

“We welcome the government’s particular focus on bringing under-represented groups into the trades, including young people, aboriginal Canadians and newcomers. These measures are further strengthened by the government’s pledge to work with the provinces and territories to harmonize apprenticeship regulations,” said Progressive Contractors Association of Canada (PCA) executive director Paul de Jong.

The success of the government’s new initiatives will depend largely on openness and accessibility for all industry participants, says the PCA.

The Construction Sector Council’s latest national summary says the Canadian construction industry will need to recruit more than 250,000 workers including the traditional number of new entrants to the workforce, to meet building needs until 2021.

Merit Canada applauded the government’s emphasis on promoting the skilled trades, but said the regulatory environment around apprenticeships in some provinces shrinks access to training opportunities.

“Whether its rules around apprentice-to-journeymen ratios or compulsory trades, these rules are a hurdle to getting as many people as possible into trades training. In that light, we are especially pleased to see the federal government’s commitment to work with the provinces to harmonize regulatory requirements,” said Merit president Terrance Oakey.

The Canadian Building Trades says the Canada Jobs Grants will allow an increase in the delivery of training and the capacity to access such training.

"The anti-union and anti-training organizations who do not train workers and oppose investing in training will use high flown phrases to talk about how the requirement to train is actually a disincentive to access skills training; this is a self-centered and narrow view. It is code for limited or no training because a highly training person has job mobility," said Robert Blakely, Canadian operating officer of the Building Trades.

"If Canada is going to recruit, train and deploy the roughly 300,000 people that the Construction Sector Council says we will need, over the near term, we need to get bang for the buck on federal investment. The federal budget announcements look like a really tremendous start down that road."

The Stop The Trades Tax Campaign says the Ontario College of Trades (OCOT) will undermine the federal budget’s initiatives to support and promote skilled trades.

“The two run completely counter. Unless Ontario stops the trades tax, it will wind up contributing to Canada’s skilled trades shortage,” said campaign chair Sean Reid.

OCOT will represent 157 skilled trades in Ontario and officials maintain it is not a trades tax, that it will bring a value add to the provincial trades community.

Gamble said one of the biggest surprises of the budget was the closing of the Canadian International Development Agency (CIDA) and transferring its mandate to the Department of Foreign Affairs and International Trade (DFAIT).

Though some in the NGO community may think this is problematic, Gamble said he is comfortable as long as they can create an environment with more private sector participation, working together with NGOs to leverage each other’s strengths.

“The issue is does our foreign trade policy make strength, is it consistent with Canada’s overall objectives,” he said.

Gamble said the budget is “just a budget” and he will be looking to see how the government acts on its commitments.

“We want to work closely with government and other stakeholder partners to ensure that the infrastructure program and other investments that the federal government is making will deliver value to the taxpayers,” he said.

— With files from Richard

Gilbert, Journal of Commerce