The Residential and Civil Construction Alliance of Ontario (RCCAO) has called on the federal government to fulfill its pledge for infrastructure investment in Ontario, including for green infrastructure to manage stormwater.
RCCAO has said that the slow release of infrastructure funds can jeopardize the province’s future economic prosperity. In addition, RCCAO called on the province to commit to infrastructure funding after the former Wynne government announced $200 billion in funding over a 14-year was promised but met with constant delay.
Andy Manahan, executive director of RCCAO, said that “a growing, modern society needs to build infrastructure faster and it needs to be more resilient.” Manahan pointed out that Toronto’s stormwater infrastructure failed to prevent recent flash floods.
RCCAO has commissioned an independent report, Infrastructure Update 2018: Ontario Infrastructure Investment – Federal and Provincial Risks & Rewards. The findings presented therein are relevant after political leaders from across the province meet in Ottawa at the annual conference of the Association of Municipalities of Ontario.
Some of the findings are as follows:
- Infrastructure investment in Ontario as a percentage of GDP peaked in 2010 at 4.2 per cent but has fallen or remained flat most years with 2016 being the lowest percentage in the last decade at 2.4 per cent.
- Deferral of investments means that future investment in Ontario infrastructure must now aspire to reach 5.4 per cent of GDP over the next 50 years to maximize its economic prosperity.
- For 2017, only 2.8 per cent of Ontario’s GDP was invested, including a paltry 0.4 per cent from Ottawa.
- The federal government contributes far too little relative to the amount of tax revenue that is generated from infrastructure investment in Ontario.
- A predicament for Ontario: increasing infrastructure investment via debt financing will result in continued long-term deficits, while rolling back investments would result in greater economic setbacks.
- A solution: Ottawa and Queen’s Park (including Ontario municipalities) must increase and follow through with funding on vital infrastructure, optimally at 2.15 per cent and 3.25 per cent of GDP, respectively.
“For a fast-growing province, the inability of our governments to follow through on infrastructure promises is unacceptable,” said Manahan. “We call on the Trudeau government and the Ford government in Ontario to work together to address the current underfunding situation on an urgent basis.”
The report was authored by the Canadian Centre for Economic Analysis, which is a leader in agent-based modelling and risk management assessments. CANCEA president Paul Smetanin said: “This study is an update on previous reports which uses our big data platform – Prosperity at Risk® – to determine optimal investment levels over a 50-year period to maximize the province’s economic future.”
Header image shows flash flooding of a Toronto street, June 2013. Credit: mark.watmough.