Highlights from Crestview Strategy’s weekly Canada-wide newsletter:
Alberta’s projected 2023-24 surplus more than doubles to $5.5B
In its mid-year fiscal update, the Alberta government announced that it anticipates a surplus of $5.5 billion, more than double its initial projection of $2.3 billion. The additional funds have been largely attributed to increases in government revenues from personal and corporate income taxes, as well as bitumen royalties. Finance Minister Nate Horner noted that the growth in tax revenue is related to the influx of new residents, but that given additional funding required for services including education and health, the budget will continue to be constrained. Total spending has increased by $1.9 billion, which is predominantly as a result of the costly wildfire season. The government plans to pay down $3.2 billion in debt in 2023-24, with debt servicing costs increasing by $309 million.
Labour shortages cost N.S. businesses $1B in missed opportunities
Nova Scotia businesses reportedly missed out on around $1 billion in potential sales and contracts in 2022 due to labour shortages, with the construction and manufacturing industries being the most affected, according to a new report from the Canadian Federation for Independent Business. The figures indicate the highest labour shortage impact in Atlantic Canada. The construction and manufacturing sectors are particularly affected, hindering the ability of businesses to pay debts, expand and support their communities. The report suggests addressing labour shortages through increased awareness of existing government programs and exposure to trade careers for high school students. Nova Scotia is taking steps to attract more workers through tax credits, changes to the apprenticeship process and immigration initiatives, targeting 11,000 new tradespeople by 2030.
B.C. maintains economic stability amid global challenges
The British Columbia Second Quarterly Report shows a better-than-expected fiscal position, with a $5.6 billion operating deficit, lower than previous estimates, and a $1.4 billion increase in revenue due to improved tax results and federal funding for wildfire recovery. The province maintains a stable debt-to-GDP ratio of 17%, supported by low debt-servicing costs and strong debt affordability, despite a global economic slowdown and high inflation. Economic indicators like slowed exports and consumer spending are offset by robust housing starts and population growth, leading to a projected economic growth of 1.0% in 2023. The government’s focus is on supporting residents through easing daily costs and investing in critical infrastructure, with employment growing by 1.4% and population by 3.0% year-over-year, largely due to a significant increase in net migration.
Bonnie Crombie Chosen as Ontario Liberal Leader
The Ontario Liberals have chosen Bonnie Crombie, a three-term Mayor of Mississauga, as their next party leader. Crombie beat out Liberal MP Nathaniel Erskine-Smith in the final round, after Yasir Naqvi and Ted Hsu were eliminated in earlier rounds. Crombie plans to resign her mayoral position in early-2024 but has not yet committed to any plans to run in a provincial by-election and enter the legislature.
Federal government reaches deal with Google on Online News Act
The federal government and Google struck a deal regarding the Online News Act, ensuring Google’s annual payments of around $100 million for sharing Canadian news online. This deal resolves concerns over negotiation models and structural issues within the Act, averting Google’s threat to block Canadian news. The agreement sets a precedent for fair compensation, benefiting Canadian media and potentially influencing global approaches to similar legislation.
Toronto uploads Gardiner, DVP to province, steps aside on Ontario Place redevelopment
Mayor Olivia Chow and Premier Doug Ford announced the transfer of oversight for Toronto’s major highways, the Gardiner and the Don Valley Parkway, to the provincial government, calling it a historic agreement. This comes after former Mayor John Tory’s bid to have the province take over development of the highways was denied. The deal also involves the province taking responsibility for the controversial redevelopment of Ontario Place. This move is expected to unlock $1.2 billion in operating supports for Toronto, addressing a $1.5 billion budget shortfall and enabling critical projects, contingent on federal support. The province’s involvement is deemed crucial for Toronto’s financial sustainability, while the redevelopment of Ontario Place remains a contentious issue, with the city acknowledging the province’s authority over project approvals.