Ottawa: Chrystia Freeland, Deputy Prime Minister and Minister of Finance, has released the 2022 Fall Economic Statement.
Here are some of the points covered in the Fall Economic Statement:
The Canadian economy faces global headwinds from a position of fundamental strength: an unemployment rate near its record low—400,000 more Canadians are working today than before the pandemic, the strongest economic growth in the G7 this year, a triple-A credit rating, and the lowest net debt- and deficit-to-GDP ratios in the G7. Canadians should be confident that we will overcome any hurdles and prosper in the days ahead.
The federal government’s fiscal anchor—the unwinding of COVID-19-related deficits and reducing the federal debt-to-GDP ratio over the medium term—remains unchanged. The federal debt-to-GDP ratio is projected to continuously decline and is on a steeper downward track than projected in Budget 2022.
Minister Freeland said: “Today’s Fall Economic Statement is focused on building an economy that works for everyone—an economy that creates good jobs and which makes life more affordable for Canadians. Even as we face global headwinds, the investments we are making today will make Canada more sustainable and more prosperous for generations to come.”
New measures proposed in the 2022 Fall Economic Statement include:
1. Making Life More Affordable:
– Permanently eliminating interest on federal student and apprentice loans;
– Creating a new, quarterly Canada Workers Benefit with advance payments to put more money back in the pockets of our lowest-paid workers, sooner;
– Delivering on key pillars of the government’s plan to make housing more affordable, including the creation of a new Tax-Free First Home Savings Account, a doubling of the First-Time Home Buyers’ Tax Credit, and ensuring that property flippers pay their fair share; and,
– Lowering credit card transaction fees for small business.
2. Investing in Jobs, Growth, and an Economy That Works for Everyone:
– Launching the new Canada Growth Fund which will help bring to Canada the billions of dollars in new private investment required to reduce our emissions, grow our economy, and create good jobs;
– Introducing major investment tax credits for clean technologies and clean hydrogen that will help create good jobs and make Canada a leader in the net-zero transition;
– Implementing a new tax on share buybacks by public corporations in Canada; and,
– Creating the Sustainable Jobs Training Centre and investing in a new sustainable jobs stream of the Union Training and Innovation Program.
Backgrounder
• Canadian workers need a robust industrial policy that will deliver good jobs by seizing the opportunities of the net-zero economy, by attracting new private investment, and by providing key resources to the world. Investing in Canada’s future is an investment in workers.
• The 2022 Fall Economic Statement makes investments in workers to grow Canada’s economy, create good-paying jobs, and tackle Canada’s investment and productivity challenges.
Net-Zero Economy
• The 2022 Fall Economic Statement builds on the government’s previous investments in jobs and skills training with the following measures.
• $250 million over five years, starting in 2023-24, to help Canadian workers thrive in a changing global economy. Specific measures include:
• The Sustainable Jobs Training Centre to bring together workers, unions, employers, and training institutions across the country to examine the skills of the labour force today, forecast future skills requirements, and develop curriculum, micro-credentials, and on-site learning to help 15,000 workers upgrade or gain new skills for jobs in a low-carbon economy.
• A new sustainable jobs stream under the Union Training and Innovation Program to support unions in leading the development of green skills training for workers in the trades. It is expected that 20,000 apprentices and journey persons would benefit from this investment.
• The Sustainable Jobs Secretariat, a one-stop shop that would provide the most up to date information on federal programs, funding, and services across government departments to support workers on the road to sustainable, good-paying jobs.
• $60 million over three years, starting in 2023-24, to create a new rapid response fund for workers to supplement existing federal and provincial or territorial labour market programming.
Jobs for Young Canadians
• To provide youth—particularly those from marginalized communities—with the support and opportunities they need to develop the skills required to find and keep good jobs, the 2022 Fall Economic Statement proposes to provide $802.1 million over three years, starting in 2022-23, to the Youth Employment and Skills Strategy. This includes:
• $301.4 million over two years, starting in 2023-24, through the Youth Employment and Skills Strategy Program, to provide wraparound supports and job placements to young people facing employment barriers;
• $400.5 million over two years, starting in 2023-24, to Canada Summer Jobs to support a total of 70,000 annual summer job placements; and,
• $100.2 million over three years, starting in 2022-23, to continue supporting work placements for First Nations youth through the Income Assistance-First Nations Youth Employment Strategy Pilot.
• These measures will help young Canadians gain valuable skills and work experience, setting them up for a lifetime of success in the job market.
Canada’s Immigration Plan
• Immigration is a key driver of Canada’s economic growth and the government has a plan to ensure increased immigration targets address persistent labour shortages, including in healthcare, manufacturing, and the building trades.
• The government will continue to invest in increasing capacity to ensure that applications are processed as quickly as possible and to eliminate backlogs.
• To support the processing and settlement of new permanent residents to Canada as part of the 2023-25 Immigration Levels Plan the government has committed $1.6 billion over six years and $315 million in new funding.
• To address ongoing application backlogs, speed up processing, and allow for skilled newcomers to fill critical labour gaps faster, the government has committed an additional $50 million in 2022-23 for Immigration, Refugees and Citizenship Canada.
Transportation Workers
• In the trucking industry, there is a long history of companies using the misleading “Drivers Inc.” practice, whereby drivers are encouraged—against their will—to self-incorporate and claim to operate as independent contractors without being provided information on the downsides of the practice. By not classifying drivers as employees, companies are denying them access to important rights and entitlements under the Canada Labour Code, such as paid sick leave, health and safety standards, employer contributions for Employment Insurance and the Canada Pension Plan, and provincial or territorial workplace injury compensation.
• $26.3 million over five years, starting in 2023-24, to take stronger action against non-compliant employers through orders, fines, and prosecutions to enforce the Canada Labour Code. This will improve working conditions for thousands of gig workers, newcomers, and racialized Canadians while creating fairer, safer workplaces for everyone by ensuring that federally regulated transportation employers are not illegally misclassifying their drivers.
Canada Growth Fund
• The Growth Fund will attract private sector investment in Canadian businesses and projects that meet the following important national economic policy goals:
• Reduce emissions and achieve Canada’s climate targets;
• Accelerate the deployment of key technologies, such as low-carbon hydrogen and carbon capture, utilization, and storage (CCUS);
• Scale up companies that will create jobs, drive productivity and clean growth, and encourage the retention of intellectual property in Canada; and,
• Capitalize on Canada’s abundance of natural resources and strengthen critical supply chains to secure Canada’s future economic and environmental well-being.
• The Growth Fund will be launched by the end of 2022 and the government will take steps to put in place a permanent, independent structure for the Growth Fund in the first half of 2023.
Clean Technologies
• Following the adoption of the Inflation Reduction Act in the United States, the need for a competitive clean technology tax credit in Canada is more important than ever. The 2022 Fall Economic Statement proposes a refundable tax credit equal to 30 per cent of the capital cost of investments in:
• Electricity Generation Systems, including solar photovoltaic, small modular nuclear reactors, concentrated solar, wind, and water (small hydro, run-of-river, wave, and tidal);
• Stationary Electricity Storage Systems that do not use fossil fuels in their operation, including but not limited to: batteries, flywheels, supercapacitors, magnetic energy storage, compressed air energy storage, pumped hydro storage, gravity energy storage, and thermal energy storage;
• Low-Carbon Heat Equipment, including active solar heating, air-source heat pumps, and ground-source heat pumps; and,
• Industrial zero-emission vehicles and related charging or refueling equipment, such as hydrogen or electric heavy duty equipment used in mining or construction.
• The Department of Finance will consult on any additional eligible technologies (e.g. large-scale nuclear and large-scale hydroelectric).
• To incentivize companies to create good jobs, those that adhere to certain labour conditions will be eligible for the full 30 per cent credit, while those that do not will only be eligible for a credit of 20 per cent. The credit would be available as of the day of Budget 2023 and no longer in effect at the start of 2035, subject to a phase-out starting in 2032.
Rising price
• The government will continue to be there for the Canadians who need it most. The government’s support has been carefully designed to avoid making inflation worse.
• Doubling the Goods and Services (GST) Tax Credit for Six Months
• Starting November 4, 2022, an estimated 11 million low- and modest-income current GST Credit recipients will automatically receive an additional payment. Single Canadians without children will receive up to an extra $234, and couples with two children will receive up to an extra $467. Seniors will receive an extra $225 on average.