CCA pre-budget submission: Group seeks improved apprenticeship cost-sharing, equipment depreciation and infrastructure program administration

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CCA prebudget submission

The Canadian Construction Association (CCA) has proposed for the 2018 federal budget that the government support apprenticeship training and increasing labour mobility, increasing industry productivity through the use of tax incentives, and creating a more efficient system of getting infrastructure funding to projects.

In the six-page submission to the House of Commons Standing Committee’s pre-budget consultations, the national association provides several recommendations, including:

Apprenticeship

“Rather than mandating the use of apprentices on federal construction projects, a more viable alternative would be to use existing federal programs, such as those funded by Employment Insurance, to better cost-share with employer’s apprenticeship training,” the CCA submission says.

These issues could be resolved by improving the Apprenticeship Job Creation Tax Credit (AJCTC), the CCA says. Specific recommendations include:

  • Redesign existing federal programs (Employment Insurance (EI) funded training programs) to provide more robust financial support to employers engaged in apprenticeship training; and
  • Increase the annual value of the AJCTC and broaden its application to all years of study in all recognized provincial apprenticeship programs by increasing the value of the current credit from 10 per cent of eligible wages (up to a maximum of $2,000) to 25 per cent of eligible wages (up to a maximum of $5,000) annually. And broadening the application of the current credit to include all years of a provincially recognized apprenticeship program and not just the first and second years of study.

The CCA also suggests labour mobility could be improved by changing EI policy to permit unemployed construction workers to obtain an advance from their approved benefits of up to $2,000 to support their employment searches outside their local area construction market.”

Tax reform

The CCA suggests that depreciation allowances should be increased to better reflect equipment life cycle, specifically to “increase the permissible depreciation rate for Class 38 assets from 30 to 50 per cent, which will better align depreciation policy with the productive life of these assets, improve overall construction sector productivity, and potentially lower infrastructure development costs for governments across Canada.”

In another recommendation, the association calls for a simplification of infrastructure programs, especially at the municipal level.

“Infrastructure Canada needs to create a single-window for municipalities to more efficiently access infrastructure funding. It should also consolidate similar infrastructure programs to cut down on the number of programs that make it difficult for municipalities to identify which fund is more suited for their projects.”

The CCA also seeks changes to the way gas tax funds are allocated. “While the Gas Tax Fund continues to be successful in providing flexible and reliable funding to municipalities, Infrastructure Canada should consult with them and make appropriate improvements to the fund in order to ensure that it covers inflation and population growth between census years.”

The association says it supports the Canadian Construction Innovations Pre-Budget Submission, “which calls for the development and implementation of a comprehensive innovation strategy for the construction sector.”

“This strategy will ensure the transformation of Canada’s built environment for future generations and ensure this sector can realize its full potential. Given the complexity and scale of the transformation needed, we urge the federal government to partner with the construction sector’s innovation ecosystem. Together, the industry and government will bring about change to meet the important national priorities of productivity, competitiveness, talent, growth and sustainability.”

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