OSPE’s Response to the 2019 Fall Economic Statement

On November 6, the Government of Ontario released its 2019 Fall Economic Statement, A Plan to Build Ontario Together.

 

Finance Minister Rod Phillips highlighted the government’s current projected deficit of $9 billion for 2019-20, as well as the projected deficits of $6.7 billion in 2020-21 and $5.4 billion in 2021-22. The government is still committed to balancing the budget by 2023-24. The Fall Economic Statement also laid out six key themes the government will focus on:

  • fall economic statementMake life more affordable;
  • Prepare people for jobs;
  • Create a more competitive business environment;
  • Connect people to places;
  • Build healthier and safer communities and
  • Make government smarter.

The Ford government has made the following announcements on policy that require the expertise of engineers:

ENERGY

Government announced:

  • Its commitment to reduce electricity bills by subsidizing residential, farm and small business electricity bill to the tune of at least $4 billion.
  • The termination of more than 750 renewable energy contracts.
  • The refocus and centralization of the Electricity Conservation Program to the Independent Electricity System Operator.
  • Continued support to the Northern Industrial Electricity Rate (NIER) Program, which provides electricity price mitigation and greater cost competitiveness for qualified large northern industrial electricity users.

OSPE’s Recommendations:

The Ministry of Energy, Northern Development and Mines should implement new regulations where surplus emission-free electricity (interruptible electricity) is priced separately from dependable electricity.

  • Consultations with appropriate engineering and electricity rate experts should occur on how best to introduce an interruptible retail electricity market.

The Ministry of Energy, Northern Development and Mines should assemble a team of financial experts, to determine how best to replace the Fair Hydro Plan at the end of 2021, with a sustainable asset base that does not impose costs on consumers for past poor planning decisions.

  • The new asset allocation structure should eliminate cost transfers between rate classes and groups that are currently creating serious cost escalation for larger commercial and smaller industrial consumers.

The Ministry of Energy, Northern Development and Mines should re-examine its electricity system supply mix plans for the 2025 to 2050 period, if it wants to meet the targets set by the International Intergovernmental Panel on Climate Change (IPCC) by 2050.

OSPE believes that the Northern Industrial Electricity Rate program should focus on providing support to all companies that meet the requirements, independent of their previous involvement in the program. This will allow new companies entering the program, the same opportunity of receiving funding, as other companies that have received it in the past.

  • A fair system would aim to provide sufficient funding to all participants who are eligible and proceed with the application process. If insufficient funding is available, funding should be equitably distributed among all eligible participants, reviewed on an annual basis.

 

ENVIRONMENT

Government announced:

  • Investment in green infrastructure through the Investing in Canada Infrastructure Program (ICIP), which will help small communities rehabilitate critical water, wastewater and stormwater infrastructure.
  • The establishment of a Day of Action on Litter.
  • The opportunity for businesses to write off investments made in specified clean energy equipment.

OSPE’s Recommendations:

Since 2017, engineers have called on the government to increase investment in green infrastructure, where adequate, and municipal stormwater infrastructure, to help protect communities across Ontario. OSPE’s Weathering the Storms: Municipalities Plead for Stormwater Infrastructure Funding report found that most municipalities do not have adequate stormwater infrastructure asset management plans, funding resources to meet the changing demands and regulatory requirements for these assets, and/or the human resources to appropriately track and monitor assets and their metrics. The government should also:

  • Make stormwater management assistance a funding priority in long-term infrastructure planning, especially for municipalities with populations under 50,000, as many do not have the necessary resources to develop a Stormwater Infrastructure Asset Management Plan (SIAMP)
  • Develop standardized criteria to help municipalities properly monitor stormwater systems

The Government of Ontario should implement policies, programs and financial mechanisms that consider opportunities to adopt green infrastructure where possible. 

  1. A comprehensive assessment of the financial, environmental and social costs and benefits of both grey and green infrastructure is required to properly conduct a full cost-benefit analysis of both options.
  2. Green infrastructure considerations should be integrated into lifecycle asset planning and management
  3. A project by project analysis is important to determine what type of infrastructure is required, given a specific set of variables.

 

INFRASTRUCTURE

Government announced:

  • The building of the Ontario Line, at a total estimated construction cost of $10.9 billion.

OSPE’s Recommendations:

OSPE’s Infrastructure Task Force has been calling on all levels of government to retain expert engineering input on transit infrastructure to guarantee short and long-term transportation planning that best serves the Greater Toronto and Hamilton Area for several years. As preliminary design work and discussions continue around the development of the Ontario Line, engineers look forward to being at the table to provide engineering expertise.

OSPE welcomes commitments to invest in much needed transit in the Toronto core. Engineers believe new transit options that help relieve the existing overcapacity of the Yonge-University-Spadina Line and create economic opportunities and development potential are crucial. At the same time, OSPE urges the government to publicly release its entire costed Ontario Line plan and consult with engineers when it comes to transit development.

At the same time, OSPE and engineers call on the government to look at transit infrastructure as a larger all-encompassing policy file. Federal, provincial and municipal governments should consider sharing resources between all three Toronto transit expansion projects (Ontario Line, Yonge North Extension and Line 2 East Extension), while moving forward with an integrated systems approach to ensure all aspects of the lines/extensions function correctly together and are delivered on time.

RESEARCH AND INNOVATION

Government announced:

  • The launch of a K-12 Ontario STEM Education Strategy that will focus on the importance of STEM in key high growth industries.

OSPE’s Recommendations:

  • OSPE welcomes the government’s commitment to promote the importance of STEM at an early age. However, OSPE believes the government must do more at a post-secondary level. Government must ensure that post-secondary engineering programs are adapting to the new knowledge economy by providing work-integrated learning (WIL) opportunities to enhance graduates’ skills as they enter the workforce.

Leave a Reply