Cost of living was a familiar theme inside the House of Commons on Tuesday as Finance Minister Chrystia Freeland tabled the governing Liberal Party’s economic plans in the 2023 federal budget.
The nearly $70 billion in new spending over the next six years has left local politicians, business leaders, and environmentalists with mixed thoughts on how that money is being allocated.
Atop the budgetary standouts included a one-time grocery rebate for lower income Canadians, which is estimated to target 11 million people at a cost of around $2.5 billion.
The rebate promises to provide couples with two children up to $467, single individuals with $234, and seniors with $225.
But even though inflation continues to subside, prices in many areas – including the grocery stores – are still rising.
Despite predictions of a mild recession this year, Sault Ste. Marie Liberal MP Terry Sheehan doesn’t anticipate the 2023 budget will affect inflation, and he’s confident the investments announced Tuesday will help make life more affordable for residents in the Sault and surrounding area.
“There’s a multitude of levers in this budget that will help businesses and organizations continue to grow,” he says. “What this budget does is continues to invest in our path forward and continuing to make sure we don’t move back to the dark ages of the previous government.”
“This will put more money into the pockets of people in Sault Ste. Marie.”
In addition to the government’s previous announcement of $22 billion of health transfers to the provinces earlier this year, the budget also includes $13 billion over five years to create a dental care plan for uninsured Canadians who have a family income of less than $90,000.
Sheehan says the move would provide much needed relief to emergency departments across the country – including here in the Sault.
“Our emergency wards are tied up with people who don’t have dental care with infections and a whole bunch of health-related issues, and they’re tying up our emergency wards,” he says. “So, the investments into dental care will make a big change.”
Meanwhile, Mayor Matthew Shoemaker is mostly satisfied with the numbers that came out of Parliament Hill this week, but he’s not convinced there will be an overwhelming impact on everyday families in the Sault.
“I don’t think the budget will change people’s lives to any great extent,” he says. “There were expected things like the increase of health transfers, which is good for our communities that are facing healthcare professional shortages and long wait times.
“It’s a system that seems to not have fully recovered from the effects of the pandemic, so more money going into that is a positive.”
Included in the budget is $1.8 billion over five years to improve airport screening, wait times, and security. However, the investment is anticipated to increase the air travel security charge by over 32 per cent. While acknowledging the rise in airport spending is necessary, Shoemaker fears the expected surge in ticket prices could be problematic for tourism.
“Any potential barrier of people coming to Sault Ste. Marie, whether that’s an increase in ticket prices or additional amounts at the pumps, is worrisome,” he says. “That is an area where we need to make sure that our airport continues to be a low-fee, low-cost place for planes to fly in.”
The feds also announced an investment of $4 billion over seven years into an urban, rural, and northern Indigenous housing strategy – a project that remains in development and would begin in 2024.
“Hopefully places like Ontario Aboriginal Housing and the Indigenous Friendship Centre can work with the city on seeing more housing go up for all of our community’s needs,” Shoemaker says. “That’s one I’m eager to see more details on.”
Other Indigenous-related investments include:
- $827 million over five years for health priorities
- $8.7 million to hold more consultations on resource sharing to develop a framework to give communities access to more resource dollars from projects built on their territories
SooToday attempted to contact Batchewana First Nation Chief Dean Sayers on those investments, but he was unavailable for comment.
Meanwhile, money spent on green energy was significant – a total that added up to approximately $80 billion for clean technology over the next ten years.
Green economy measures include:
- $20 billion to Canada Investment Bank to support major clean electricity and clean growth projects
- 15 per cent clean electricity investment tax credit – a cost of $6.3 billion over four years
- 30 per cent credit in new equipment used in clean technology manufacturing at $4.5 billion over five years
Sault Climate Hub co-chair Ted McPherson says those investments were imperative in playing catch-up with U.S. president Joe Biden’s massive green infrastructure investments.
“If we didn’t do something, all the investments would go south,” he says. “We do want to keep automobile manufacturing in Canada, so that was definitely a necessary thing to do. It seems like they’ve done a decent job on most of those things.”
Canada’s goal in reaching a zero-emission electricity grid is still far away according to McPherson, and he explains that two levels of government combating over the issue hasn’t helped the cause.
“The federal government is trying to convince provinces to get clean energy and clean electricity,” he says. “Here in Ontario, our government has absolutely zero interest in that. They’ve gotten rid of all the contracts for clean energy, torn down some wind turbines, and they’ve been busy buying gas plants.”
“We have two diametrically opposite approaches here – the federal government would like to get it clean, and the provincial government doesn’t care at all about emissions. They have no interest in saving or reducing emissions as far as I can tell.”
Meanwhile, the Ontario Chamber of Commerce issued a press release on Monday calling on the federal government to present a clear strategy for economic growth.
Sault Ste. Marie Chamber of Commerce CEO Rory Ring doesn’t believe the feds achieved that.
“When you see the projections for our economic growth, it really is not impressive at all,” he says. “We’re hoping our small businesses aren’t as greatly impacted as they might be in other jurisdictions. But the government doesn’t have a real strategic plan to grow our economy. They didn’t address the needs for regulatory reform to make it easier to do business in Canada.”
“I think we’re somewhat buffered from a major recessionary period because we’ve had growth at Algoma Steel with the electric arc furnace, investments made by Tenaris, and college and university expansions.”
Lowering credit card transaction fees for small businesses was also part of the 2023 federal budget, where Mastercard and Visa have agreed to lower interchange fees by up to 27 per cent – a deal expected to save small businesses $1 billion over five years.
“That is a very positive thing to be doing,” Ring says. “It helps our small business community to reduce the expenses they have to incur.”
In a press release issued Tuesday night, Canadian Federation of Independent Business president Dan Kelly echoed Ring’s sentiments but noted it’s a broad outline as it stands currently.
“A 27% reduction in small business merchant fees is significant, but more details are needed to determine how many small businesses will benefit from this plan,” Kelly says. “CFIB has been working closely on this file with government and is pleased with the commitment to expand reductions to other cards, such as American Express, and ensure the reductions are passed on to small firms by payment processors.”
Other notable investments from the 2023 federal budget include:
- $158.4 million to implement a 988 suicide prevention hotline
- $48.9 million over three years to protect Canadians from foreign interference and intimidation
- $13.5 million over five years to start National Counter-Foreign Interference Office
- Canada student grants increased by 40 per cent
- Alcohol excise duty capped at two per cent for one year
To view more details from the 2023 federal budget, visit here.