Min­is­ter says in­fras­truc­ture work will pay off

Sousa met with mem­bers of the Burling­ton, Oakville and Mil­ton cham­bers of com­merce

The Hamilton Spectator - - BUSINESS - STEVE ARNOLD sarnold@thes­pec.com 905-526-3496 | @arnol­datTheSpec

BURLING­TON — For two years On­tario has been pour­ing money into new roads, GO ser­vices, Toronto sub­ways and In­ter­net ser­vice for rural areas.

The pace of spend­ing has been blis­ter­ing, and On­tario’s Fi­nance Min­is­ter says it’s go­ing to con­tinue.

Charles Sousa told a joint meet­ing of the Burling­ton, Mil­ton and Oakville cham­bers of com­merce Thurs­day the work of re­boot­ing the prov­ince’s econ­omy isn’t fin­ished yet.

“On­tario was in the mid­dle of a frag­ile post-re­ces­sion re­cov­ery when we took over,” Sousa told the busi­ness au­di­ence.

“In the past, an in­vest­ment like we have been mak­ing would have been fol­lowed by a long ‘shov­els down’ pe­riod, but we’re just get­ting started.”

Sousa said the Wynne gov­ern­ment’s 12-year, $160-bil­lion pro­gram of in­fras­truc­ture and cli­mate change in­vest­ment is crit­i­cal to pre­par­ing the econ­omy for the fu­ture.

“I know some peo­ple would pre­fer we left ac­tion on cli­mate change to the next gen­er­a­tion be­cause they think there’s no im­me­di­ate threat to them,” he said. “We have to act now be­cause we owe it to that next gen­er­a­tion.”

In ad­di­tion to pour­ing money into phys­i­cal as­sets such as roads and bridges, the gov­ern­ment ac­tion plan in­cludes in­vest­ments in peo­ple — such as a con­tro­ver­sial plan to pro­vide free post-sec­ondary tu­ition to low-in­come stu­dents.

“We know that ed­u­ca­tion is the most im­por­tant way to break the cy­cle of poverty,” Sousa said.

In ad­di­tion to all of that, he added, the prov­ince will bal­ance its books next year, elim­i­nat­ing a deficit that has been a drag on the econ­omy for years.

“The growth we have to­day can­not come at the ex­pense of to­mor­row,” he said. “That’s why we are go­ing to bal­ance the books next year.”

In a ques­tion-and-an­swer ses­sion after his for­mal pre­sen­ta­tion, Sousa said the deficit will be elim­i­nated by dis­ci­plined spend­ing.

“We are go­ing to go through the bud­get line by line to en­sure we are spend­ing ef­fec­tively.”

On­tario’s deficit-to-gross do­mes­tic prod­uct ra­tio sits at 39 per cent. That com­pares favourably to 50 per cent for Que­bec and more than 80 per cent in some Euro­pean coun­tries, but Sousa said the goal is still to cut that num­ber to 27 per cent.

He said a ma­jor eco­nomic prob­lem re­main­ing for the Greater Toronto Area is the cost of traf­fic con­ges­tion — some­thing the gov­ern­ment will try to tackle through high-oc­cu­pancy ve­hi­cle toll lanes.

In an in­ter­view after the ses­sion, Sousa said the gov­ern­ment con­tin­ues to watch de­vel­op­ments in the Stelco and Al­goma steel re­struc­tur­ings closely.

The gov­ern­ment re­cently an­nounced a $2.6-mil­lion top-up to a fund to help lo­cal re­tirees deal with los­ing their drug ben­e­fits.

“They are in the midst of look­ing for pro­po­nents to bid for Stelco as well as Al­goma. We’ll see what hap­pens, but in the mean­time we rec­og­nize that the pen­sion­ers and work­ers need to be sup­ported and that’s what we’ve done,” he said. “We’re work­ing with what we have avail­able to us.”

On­tario’s stake in the re­struc­tur­ing is huge — it is owed $150 mil­lion loaned to Stelco in 2006 to top up its pen­sion plans.

There is also mil­lions of dol­lars in pen­sion top-ups at stake if the com­pany is liq­ui­dated with its plans still in deficit. That’s all in ad­di­tion to en­vi­ron­men­tal li­a­bil­i­ties for the com­pany’s bayfront land.

“We rec­og­nize that when U.S. Steel came into play, there was an en­vi­ron­men­tal li­a­bil­ity and we did step up to try to sup­port them in that tran­si­tion. They’ve not per­formed to our sat­is­fac­tion,” he said. “We have that li­a­bil­ity and we are try­ing to pro­tect the in­ter­est of the prov­ince and the work­ers.”

Sousa re­turns to the area Mon­day, when he is to hold a closed­door meet­ing with about 20 mem­bers of the Hamil­ton Cham­ber of Com­merce.

The growth we have to­day can­not come at the ex­pense of to­mor­row. That’s why we are go­ing to bal­ance the books next year. CHARLES SOUSA ON­TARIO FI­NANCE MIN­IS­TER

DAR­RYL DYCK, CANA­DIAN PRESS FILE PHOTO

On­tario Fi­nance Min­is­ter Charles Sousa says traf­fic con­ges­tion re­mains a prob­lem in the GTA.

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