MISSISSAUGA, ONT. — The 2019 federal and provincial budgets will assist in stabilizing the construction and surety markets, says to the Surety Association of Canada. One of the provincial budget highlights, according to the association, included Ontario’s Capital Plan Outlook for planned investments in 2019‐20 totaling $14.7 billion and reflects the government’s commitment to invest about $144 billion over the next 10 years.
It was announced that beginning in 2019-20, the government’s plan reflects more sustainable levels of infrastructure investment and a more realistic forecast of construction timelines for major projects planned or underway, in keeping with actual expenditure patterns, the release indicates.
On the federal level, the 2019 budget doubles support for municipal infrastructure priorities through a Municipal Infrastructure Top‐Up, which will double the amount of money that municipalities get through a one‐time transfer of $2.2 billion through the federal Gas Tax Fund. It will provide much needed support for local priorities, including funds that will help address the short‐term priorities of municipalities including repairs for roads and bridges, public transit, and building water treatment facilities, states the release.
“The commitments by both the Federal and Ontario governments will assist in stabilizing both the construction and surety markets and will help to position surety products as a necessary and dependable product to minimize risk going forward for construction and infrastructure projects,” stated Steven D. Ness, president of the Surety Association of Canada, in a statement.
“These investments are a much‐needed boost for the surety industry, as our members are working hard to fix the problems created by the recent failures of three megacontractors in 2018.”
Last year, sureties incurred more than half a billion dollars in claims more than any other year in its history.
“The good news here is that the surety industry has stepped up to pay the outstanding bills and arrange for the completion of the abandoned projects,” added Ness. “The swift and responsive action of our members helped to lessen the impact of what would otherwise have been a total calamity.”