We give the government's budget a B-
We appreciate the investments in skills, the efforts to stimulate the economy and the focus on green technology. However, we were disappointed by the cancellation of legislated reductions in the small business tax rates and that infrastructure spending was so oriented towards social spending goals rather than economically productive investments. We eagerly await the coming announcements on Phase 2 of Canada's infrastructure plan as well as the upcoming Innovation Agenda.
Done right, the government’s commitment to building infrastructure can be an important investment in the future. However, every dollar being committed is borrowed money that we can’t afford to waste. The government must focus on the projects that will benefit Canada’s economy the most: trade-enabling infrastructure, urban infrastructure and measures to support our resource and manufacturing sectors. We hope to see more of these concrete measures in the second phase of the infrastructure plan.
We welcome a number of measures that address issues raised in our report on the Top 10 Barriers to Competitiveness for 2016. The implementation of an innovation strategy, the investment in research and development in Canada’s universities, the focus on skills and training and the support provided to innovation clusters and incubators will ensure Canadian companies have the tools they need to rapidly grow into global competitors.
On clean technology innovation, we urge the government to take advantage of the projects already under development. Canada’s resource-based economy makes it an ideal hub for innovation on green and sustainable technology, which can contribute to cleaning our planet while making Canada’s economy more competitive. Canadian businesses are becoming leading experts in the creation of measures and technology that allow us to safely and responsibly develop our natural resources. The government must work with the private sector and the innovations they are developing.
The announcements on tourism are also very positive. There isn’t a single region, city or town in Canada that doesn’t benefit from tourism. The $50 million being invested to get more people to visit Canada is positive in every way and will generate returns in communities across the country.
On a cautionary note, we are wary of the deficit outlined in this budget and the time it will take to return to a balanced budget. Putting money on our collective credit card in the short term can be acceptable, if we have a solid plan on how to pay it back. What we must not do is to spend now and send the bill to our kids. We urge the government to keep its promise to balance the budget during the term of this Parliament.
We are disappointed with the government’s decision to push back the small business tax reduction and questions the idea of contemplating increases to CPP at this point. As businesses struggle, this added pressure could slow down job creation and investment.
We will be closely monitoring the government’s economic strategy. With the right choices, Ottawa can help grow business and make Canada more competitive. With the wrong choices, these are deficits that could easily spiral and hobble our economic competitiveness. The business community is ready to work with the government to make sure that, collectively, we take the right path.
View our Budget 2016 Scorecard.