11 June 2009
Cambridge, Ontario
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Good morning ladies and gentlemen.
Thank you Gary for that warm introduction, and thank you for all your hard work as Canada’s Minister of State for Science and Technology.
Thank you as well to Senator Duffy for serving as our master of ceremonies this morning. And thank you everyone for taking the time to join me to discuss the challenges we face during this global recession.
I know these are trying times for many Canadian families, those who have been affected, directly or indirectly, by the worst downturn in the world economy in half a century.
Canadians are concerned about their jobs, paying their bills, saving for their kids’ education, and planning for their retirement. Small business owners are struggling, communities are hurting, and young people are worried about the future.
I understand these real challenges Canadian families face.
That’s why we launched Canada’s Economic Action Plan, which contains our stimulus measures to help Canadian families and businesses get through the worst of the crisis, and to lay the groundwork for our economy to emerge stronger than ever.
We are making progress. Some signs of stabilization have been appearing in the world economy, and Canada’s economic performance, though pulled down by the global recession, remains the best among all major developed countries.
Our Economic Action Plan is helping; it’s making a real difference.
In March I updated Canadians on our efforts to cut bureaucratic and political red tape so the extraordinary stimulus measures in our Plan would start helping our economy right away.
Today, I am here to announce that only 10 weeks into this fiscal year, fully 80 percent of our Plan’s funding has been committed and is being implemented across the country.
These measures are creating and protecting jobs, building infrastructure, easing the tax burden on families, supporting Canadians who have lost their jobs, helping threatened industries, and laying the foundations for our future prosperity.
Combined with the actions taken by provinces and territories, Canada’s economic stimulus this year and next is proportionally the largest of any country in the G7.
And we’re implementing it faster than anyone too. As one Canadian newspaper columnist marvelled this week, the unprecedented speed of our Action Plan is “the equivalent of hatching an egg in the morning and having chicken salad for dinner.”
Ladies and gentlemen, as I have said before, Canada was the last G7 country dragged into the global recession, we have been the least affected, and we will ensure our country emerges in the strongest position.
Now let me take a few moments to update you on some key parts of our plan. One of our main priorities, of course, is to carry out infrastructure projects across the country. These projects will not only create jobs in our communities right away, but will also help pave the way for Canada’s future growth and prosperity.
Working with other levels of government, we have dramatically accelerated the planning, development and execution of infrastructure projects from coast to coast to coast.
These efforts are working: I am pleased to report that some 3,000 individual projects across the country are now getting underway – no small feat only 72 days into a new fiscal year.
Tendering, design and engineering work has begun on many large projects the Champlain Bridge in Montreal, the Alexandra Bridge in Ottawa and the Burlington Lift Bridge.
And hundreds of smaller projects are already well underway, putting Canadian electricians, plumbers, roofers, lighting technicians, flooring contractors, and labourers back to work. Let me highlight just a few projects:
On May 20, our government announced that we are investing in the Summerside Wind Farm Project in PEI. We are partnering with the government of Premier Ghiz and the city to build two huge new wind turbines that will ultimately supply a quarter of Summerside’s energy needs. The turbines are on order and construction of their bases and the transmission lines is expected to begin this month. This project is creating jobs, boosting the local economy and lowering dependence on electricity from outside the province.
In Quebec, we have formed a partnership with the Charest government to upgrade municipal water system and wastewater treatment infrastructure. The improvements to the Lévis water filtration plant alone will double its existing capacity and ensure clean, safe water for 50,000 people.
In Yukon, we are partnering with Premier Fentie’s government to build a new powerhouse at the Mayo hydro-electric generating station. This project will double power output without any new dams, reservoirs or flooding.
We are also extending a transmission line to connect Yukon’s two electrical grids. Ground clearing and engineering studies are getting underway this summer. At its height the project is expected to employ 350 people, and when finished it will reduce Yukon’s dependence on diesel power by 40 percent, and cut greenhouse gas emissions by half.
In British Columbia, we have joined with Premier Campbell’s government to build the new Evergreen rapid transit line. This new line will ease commuting in Greater Vancouver’s fast-growing northeast by removing up to 60,000 cars a day from local roads. Engineering and environmental work is getting started now, and when fully underway the project will create an estimated 8,000 jobs.
Closer to home, right here in Cambridge, seven municipal buildings, the Preston Auditorium and local roads will all be rehabilitated starting this year thanks to our unprecedented infrastructure funding.
Also here in Ontario, just down the 401, we are working with Premier McGuinty’s government to support a huge expansion of the rapid transit system in the Greater Toronto Area. This includes increasing parking capacity for the GO Transit system and building the Sheppard East light rail transit line, on which construction is set to begin next month.
In partnerships across the country, we are advancing other job-producing projects like the Calgary ring road, upgrades to Sarnia’s Blue Water Bridge border crossing, and Winnipeg’s inland Centreport project, to name just a few.
From a pedestrian overpass in Surrey B.C. to the Weymouth Library in Weymouth, Nova Scotia; from community recreational facilities to the Trans-Canada national trails system; these projects are creating jobs, helping families and communities, and paving the way for long-term economic growth.
In fact, this represents the largest infrastructure renewal effort in this country in over half a century.
But my friends, we’re not just supporting big public infrastructure. We’re also supporting the infrastructure that matters most to Canadian families - their homes. Our government’s Home Renovation Tax Credit and other programs are helping tens of thousands of Canadians right now to fix their roofs, renovate their kitchens and make their homes more energy efficient. So far, we’ve had 700,000 inquiries on these programs via email and telephone.
We’re also helping Canadians invest in new homes, through the First-Time Home Buyers Tax Credit and the new Home Buyers’ Plan. And it’s working, friends; housing starts were up by more than 10,000 last month.
Ladies and gentlemen, while we are rolling out projects across Canada, we are not forgetting Canadians who have lost their jobs due to the global recession. One of the hardest things someone will ever go through is walking in the front door of their home and telling their family that they’ve lost their job. Our goal, make no mistake about it, is to get those people working again.
But in the meantime, many are relying on Employment Insurance. The first thing we’ve done in this period of increased EI claims is to take steps to ensure that Canadians receiving benefits get them as quickly as possible. As a result since January nearly 80 percent of Canadians submitting new EI claims are now receiving their first cheques within 28 days on average.
We’ve also enacted measures to strengthen the system for those who have long been paying in. We’ve extended the maximum EI benefit period by five extra weeks and we are providing special assistance for long-tenured workers.
We are also putting more - a lot more - into retraining programs. The reality is that our economy is changing. Many older jobs will not come back. The jobs of tomorrow will be different and we want to make sure Canadian workers get those jobs.
We have also enhanced the EI work-sharing program. Since the beginning of this year, over 100,000 Canadians have benefited from this program. It assists workers who agree to work a little less so that they and their co-workers can stay on the job.
All told, our government will spend $5.5 billion more on employment insurance benefits for Canadians this year.
The EI system is not perfect. We are looking at more improvements for the fall. But don’t let anyone tell you that the EI system is not responding to the realities of the recession. It is – and we should be proud of that.
Ladies and gentlemen, our Economic Action Plan is also looking beyond today’s unemployment and at the job creation of the future. And nothing is more focussed on Canada’s long-term economic future than our massive investments in scientific research and development.
In fact, led by Minister Goodyear, we are investing proportionally more in R&D than any other G7 country. This year, the three main federal research granting councils will have $400 million more for projects than they did just three years ago. Another $2 billion is going into upgrading research labs and classrooms at universities and colleges across the country.
This includes new internet labs at St. Francis Xavier University in Antigonish, upgraded chemistry, biological science and health innovation facilities at the University of Alberta, and expanded information and communication technology facilities at the University of Waterloo and Conestoga College, right here in “Canada’s Technology Triangle.”
We are also expanding rural broadband, upgrading Arctic research, and providing greater support for clean energy research.
These investments and others not only stimulate economic activity today, they will also build the foundations of our economic future. But focussing on the future does not mean we’ve forgotten Canada’s traditional industries.
The global recession has hit these industries and the families and communities that depend on them hard, and we have acted quickly to help. As of June 1, three-quarters of the funds committed to supporting forestry, mining, tourism and agriculture are in place. This includes the billion-dollar Community Adjustment Fund, which is helping smaller single-industry communities to create jobs and to adapt to the markets of the future.
In Quebec, for example, the Community Adjustment Fund is creating some 8,000 reforestation jobs in regions sustaining devastating job losses in the forestry industry, including Saguenay-Lac-Saint-Jean, Abitibi-Témiscamingue, the North Shore and the Outaouais. Also for the forest sector, we are providing resources to boost market diversification and encourage innovation.
To aid the tourism industry, our government is contributing to various cultural activities, including twelve large Canadian festivals such as the Montreal Jazz Festival and the Fringe Festival in Edmonton.
We have also stepped in to protect our farmers and fishermen with measures like guaranteeing loans to help young farmers take over family farms, expanded slaughterhouse capacity for livestock producers, support for the lobster and salmon fisheries on the East and West Coasts, and upgraded commercial harbours for fishermen in every part of Canada.
Ladies and gentlemen, these are the industries that built this country and the communities they support are the very bedrock of this land. We want these industries around tomorrow, and that’s why we’ll continue to act to help our loggers, farmers and fishermen today.
I could go on for some time. I haven’t even talked about our efforts to expand the accessibility and affordability of credit, or the joint measures we are pursuing internationally, such as what we’ve had to do on the auto sector, for example.
But what I do want to talk about is the cost of all this. And that, of course, is the deficit.
As every other G-20 country has discovered, under the current circumstances a deficit is necessary. Our deficit will be significant, but it is affordable.
In fact, compared to other countries’ deficits, it’s fairly modest. Because we paid down debt when times were good, we have kept our debt levels low and been able to do more stimulus with a smaller deficit than any other G7 country. As you can see from the overhead chart, our deficit and our debt in relative terms are a fraction of what they are in the other major economies.
And we’ve been able to do this while lowering taxes.
We’ve taken two percentage points off the GST for all Canadians.
We’ve lowered income taxes, particularly for low and middle income earners, permanently, during this recession to put money in people’s pockets.
We’ve provided a tax credit for all dependent children and a $1,200 a year benefit for families with pre-schoolers.
We’ve brought in enhanced benefits for seniors, including, for the first time in Canadian history, income splitting, for the pensioners of this country.
We’re giving all Canadians the opportunity to earn tax-free income through Tax Free Savings Accounts.
We’ve reduced taxes on businesses of all sizes. In fact, we will soon have the lowest statutory business tax rates in the G7.
Taxes are down so far, in fact, that Tax Freedom Day arrived on June 6 this year. That’s three days earlier than last year - and 19 days earlier than the year before we took office. Taken together we have reduced federal taxes to their lowest level in 50 years.
And this is a big reason, my friends, why Canada should come out of this recession sooner and stronger than other countries.
But that all depends on staying on course. Stimulus spending must be temporary. It must end when the recession ends. And taxes must stay down and, when possible, go even lower.
On the other hand, every day in Parliament we face demands to change this course. We face demands from the Opposition to spend literally tens of billions of dollars more and to make stimulus spending permanent.
That would mean deficits that would not only be larger but permanent as well. And it would mean tax increases.
All the other parties in Parliament still believe, in their hearts, in the old philosophy of tax and spend. Every week they bemoan the fact that we cut the GST, that we cut business taxes, that we won’t raise payroll taxes, that we haven’t imposed a carbon tax.
In fact, it was right here in Cambridge that the Leader of the Opposition said unequivocally that he will raise taxes.
Let me be clear about this, ladies and gentlemen, raising taxes to pay for higher permanent government spending is a valid political option. But it is one that our Conservative government will not entertain.
I also believe that, right now, it would be a mistake of historic proportions. It would rob Canada of the opportunity that lies before us; to be the best platform from which to do business in North America, and the best place in the world to invest.
Only in Canada have we avoided nationalizing banks and raising taxes.
Only in Canada have we maintained a solid long-term fiscal position with no threat of widespread deflation now or renewed inflation later.
And only in Canada have we focussed almost exclusively on using short-term spending to support long-term economic growth.
We are on the right course. The only thing that can get us off course now is needless political instability.
Of course, we will do our best to listen to good ideas that can help us during this recession. But we will not do things that we know will harm the country in the long run.
Stay on course. Keep spending temporary and taxes down and Canada will remain the last G7 country into this recession, the least affected, and the strongest in the world coming out.
Friends, only 72 days into this new fiscal year, the unprecedented measures undertaken in our Economic Action Plan are starting to show results. The effects of the recession are beginning to ease. And Canada’s strengths are being noticed beyond our borders.
The World Economic Forum Has called the Canadian banking system the soundest on earth.
The IMF has said our financial sector has shown “remarkable stability amid the global turbulence, thanks in good part to strong supervision and regulation.”
A recent article in the Washington Post called us “The Great Right North.”
And the newspaper Le Monde published an article entitled: “Canada is rich in natural resources and fiscal wisdom.”
Now, more than ever, we must stay the course.
Governments at all levels must continue to focus on the economy, on moving Canada’s Economic Action Plan through to completion. In short, we must persevere, as Canadians have done throughout our history to overcome countless challenges.
That is why I am so confident we will emerge from this crisis as we have from all the others, stronger, better, and more prosperous than ever.
Thank you.
