CA$ 20 billion for construction in Canadian action plan
By Richard High28 January 2009
Canada's Minister of Finance, Jim Flaherty, has unveiled an economic action plan worth CA$ 30 billion (US$ 24.8 billion), or 1.9% of GDP, as part of the country's 2009 Budget.
Almost CA$ 12 billion (US$ 9.9 billion) has been earmarked for spending on new infrastructure: roads, bridges, broadband internet access, electronic health records, laboratories and border crossings across the country.
Another CA$ 7.8 billion (US$ 6.5 billion) will be spent building quality housing, stimulating construction and enhancing energy efficiency.
Measures include a renovation tax credit that would provide about 4.6 million families with up to CA$ 1350 (US$ 1117) each, funding for energy retrofits, investments for social housing to support low-income Canadians, seniors, persons with disabilities and Aboriginal Canadians, and low-cost loans to municipalities.
Aboriginal communities will receive CA$ 515 million (US$ 426 million) over two years to improve their infrastructure, with schools and water projects a priority.
About CA$ 4 billion (US$ 3.3 billion) will be spent in partnerships with provinces, territories and municipalities. However, these lower levels of government will have to provide up to half of the projects' cost.
The government also pledged CA$ 1 billion (US$ 827 million) in spending over five years for green energy projects, CA$ 500 million (US$ 413 million) for local recreation centres and another CA$ 500 million (US$ 413 million)for infrastructure projects in small communities.
Investments in federal projects include CA$ 407 million (US$ 337 million) to improve the government-owned VIA passenger rail service. Another CA$ 323 million (US$ 267 million) will be allocated for the restoration of federally owned buildings.
Over the next two years, the total stimulus to the Canadian economy, including stimulus from other levels of government, will surpass CA$ 50 billion (US$ 41.3 billion), or 3.2% of GDP.
"Budget 2009 is Canada's economic action plan. It builds on our position of strength. It provides temporary and effective economic stimulus to help Canadian families and businesses deal with short-term challenges, said Minister Flaherty.
When combined with the ongoing benefits of the tax reductions in the 2007 Economic Statement, he added, the Economic Action Plan is estimated to boost real GDP by +2.5% and create or maintain about 265000 jobs by the end of 2010.
"We are not acting alone," said Minister Flaherty. "These actions fulfill Canada's commitments to its global partners at the G20 leaders' summit to provide timely stimulus to domestic demand, while maintaining long-run fiscal sustainability.
"With this stimulus plan, Canada will emerge from this recession with a more modern and greener infrastructure, a more skilled labour force, lower taxes and a more competitive economy" added the Minister.