Province defends millions in corporate grants to profitable firms
TORONTO Ontario’s Liberal government has handed out more than $907 million in corporate grants since 2013, with the largest amounts going to profitable high-tech companies and big automakers.
Figures released by the government show IT giant Cisco Systems got $220 million from the province, Fiat-Chrysler and Honda Canada both got over $85 million, while the Ford Motor Company got over $70 million.
The government says the grants helped leverage over $2 billion in investment in Ontario’s auto sector, and helped create and retain about 68,500 jobs.
The bulk of the grants were awarded under the province’s jobs and prosperity fund, about $783.7 million so far, while smaller grants were handed out under regional development funds for eastern and southwestern Ontario.
Economic Development Minister Brad Duguid says the government has to enter into “strategic partnerships” with companies because other jurisdictions offer financial incentives to attract new investment — and the jobs that go with it.
Progressive Conservative critic Monte McNaughton says the government has refused to release the names of companies that received corporate grants between 2003 and 2013, many of which were awarded with no public application process.
“Instead, the minister and the premier, behind closed doors, hand-picked the companies that would receive the payouts, by invitation only,” said McNaughton.
“It’s creating a very unlevel playing field, and businesses who aren’t getting grants are paying higher taxes to supplement their competitors.”
Duguid said direct government support for businesses can often be the deciding factor in securing private sector investment in the province.
“The alternative is they’ll just locate in other jurisdictions because they’re offering business investment supports in many cases four or five times what we offer,” he said.
“You’re either in the game or you’re not in the game ... and we’re in the game and aggressively out pursuing these investments.”