Ottawa Construction News staff writer
The newly re-elected Liberal government’s budget has reconfirmed its election-promise infrastructure spending commitments, providing some good news for Ontario’s battered construction industry.
“They presented the most comprehensive commitment to long-term infrastructure investment during the election and Finance Minister Sousa has followed through by making it one of the budget’s themes,” the Ontario General Contractors Association (OGCA) says in its bulletin.
“The 10-year Infrastructure Plan is a vital component of building our economy,” says OGCA president Clive Thurston. “Private sector investment continues to be weak. Investment from all levels of government is vital to support infrastructure construction which supports the provincial economy.
The government has committed to $29 billion for transit projects, with dedicated funding to pay for part of them. This is not new spending but a shift in allocation with a greater focus on transit, the OGCA says. “The ‘Moving Ontario Forward’ plan proposes to create two new dedicated funds: one for the GTA and the other for the rest of the province. The transit budget has been increased by $424 million to $3.15 billion for the fiscal year.”
The document also shows there are shifting priorities where investments are being made, according to the OGCA. “The government’s 2013 commitment to over $13 billion in infrastructure came up short at $10.814 billion in 2013, leaving $2.15 billion unallocated. Ministry of Finance officials explained that delays in awarding contracts were the prime reason that the commitments were carried over to the 2014 fiscal year. The new infrastructure commitment is $12.28 billion for 2014.”
The non-residential construction industry had a bad 2013, the OGCA reports. “The budget documents report non-residential construction GDP fell 1.6 per cent in 2012 and dropped 8 per cent in 2013. This is consistent with reports OGCA has been receiving from our members for some time. It is the first provincial government recognition that the Ontario non-residential construction industry is in a serious downturn.”
Other Budget provisions include a 1 per cent increase on personal income tax paid on amounts over $150,000 per year effective for the 2014 taxation year, and a tightening of the small business deduction, including paralleling the federal small business deduction phase out.
