Campaign promises about revenue first
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Hey there, time traveller!
This article was published 30/08/2019 (1131 days ago), so information in it may no longer be current.
Reduce wait times, increase health budgets, build schools and safe injection sites, set up an education-reform task force, fund child-care spaces — these social-infrastructure election campaign promises are all worthy of debate and degrees of support.
But can we afford them? Typically, political parties “cost” their election promises mid-campaign. What we need to ask is how government will ensure the necessary revenue will flow to the treasury so these vital, quality-of-life social programs can meet the pressures of inflation and public demand.
So far, Manitobans have not heard any policy proposals on this most basic element. To punctuate this discussion, last week’s economic growth forecast out of the Conference Board of Canada is sobering: Manitoba is expected to see GDP growth in 2019 of about 0.5 per cent. Half a percentage point — markedly down from the province’s own forecast of 1.7 per cent.
We need our party leaders to talk about this. If our economy does not grow, Manitoba won’t have the revenues to support the programs that make our standard of living globally envied, and discussion of improving our health, education and other services will be rendered moot.
One of the best ways to spur the economy — verified by economic analyses — is through infrastructure investment. Why? Because infrastructure enables our work, our daily activities. Core infrastructure — streets, highways, bridges, water and wastewater systems, land drainage — is the foundation upon which we build our economy. Without it, our communities could not operate.
More to the point, it enables trade. Perrin Beatty, president of the Canadian Chamber of Commerce, said it best: “There is the infrastructure we want, like skating rinks and parks, the infrastructure we need, like health care and education, and then there is the infrastructure that pays for it all, and that is trade infrastructure.”
In Manitoba, our trade infrastructure — our networks of roads, highways, bridges and structures — is the foundation upon which our trade-reliant economy is based. Trade generates 53 per cent of our GDP and sustains 240,000 direct and indirect jobs. If you bought it at a store, it got there by a truck. Your trip to school, the gym or work today was made possible by strong, reliable infrastructure.
It’s what links our provincial economy with the rest of Canada, into the United States, our largest trading partner, and to the rest of the world, where our real opportunities to expand our trade profile rest.
Now that Manitoba is returning to a balanced fiscal position, likely to see a budget surplus in 2021, it is time to invest in economic-growth policies. The known economic value of infrastructure investment is why 10 leading business organizations have made it a top priority in their = document.
It is time to replenish the highways budget, which has been cut to $350 million since 2016, but that move must be guided by the adoption of a long-term asset-management and investment strategy. We’ve heard some infrastructure promises to date, but we have not heard talk about a multi-year, strategic investment approach that includes an asset-management plan.
Manitoba’s highways and bridges require $500 million to $600 million annually just to maintain them in their current condition. Another $200 million to $300 million is needed annually to enhance existing assets and build the new assets required by a growing population and for expanded trade opportunities. Our transportation infrastructure suffers from an approximately $9-billion investment deficit. This is why an asset-management plan is critical.
And about our communities: municipalities deliver the bulk of services that make our communities work. But their revenues are unequal to the cost of maintaining and building new infrastructure — they get a mere 10 cents of every tax dollar collected.
We urge party leaders to commit to establishing a working group to recommend the means by which core infrastructure investment can be reframed, focused first on projects with the highest economic return. It should look at the potential of merging the ministry of trade with infrastructure, recognizing the role of highways and trade infrastructure in economic growth.
We also urge party leaders to start talking about a new fiscal deal to open new revenue sources for municipalities and to share more of the financial burden of maintaining municipal infrastructure. We need to hear our party leaders’ proposals for a stable, sustainable, strategic infrastructure investment approach, well ahead of election day on Sept. 10.
Economic growth supports our quality of life. Core infrastructure grows our economy. To all party leaders: we are listening. We are waiting to hear from you.
Chris Lorenc is president of the Manitoba Heavy Construction Association and Western Canada Roadbuilders & Heavy Construction Association.