Liberals to double federal infrastructure investment, creating joy in Canada’s design and construction community

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Canadian Design and
Construction Report staff writer

The new Liberal government’s plans for a massive increase in federal infra-structure spending has generated much enthusiasm within Canada’s design and construction industry community.

The scale of the investment – na-tionwide doubling infrastructure ex-penses to nearly $125 billion over 10 years from $65 billion – will create mammoth sized opportunities for the industry, especially in the Liberal’s pri-ority areas of transit, green projects, and social infrastructure (including sen-ior and low income housing, and recre-ational and learning facilities.)

The Liberals don’t break down how much will be spent in specific provinces and territories. Notably, when the Conservatives introduced a major infrastructure stimulus program after the late 2008/9 financial crash much of the money found its way to the National Capital Region, though the longer-range plans appear to be in-tended to distribute the wealth more widely across the province and coun-try.

In the election campaign, the Liberal Party promised: “Each year over the next decade, we will steadily increase federal infrastructure investment.”

The party platform – which can be implemented without hindrance with a Liberal parliamentary majority – says

New infrastructure spending ($ Billions)

Year Public Transit Social Green
2016-17 1.7 1.7 1.7
2017-18 1.7 1.7 1.7
2018-19 1.2 1.2 1.2
2019-20 1.2 1.2 1.2
2020-21 1.5 1.5 1.5
2021-22 1.8 1.8 1.8
2022-23 2.2 2.2 2.2
2023-24 2.5 2.5 2.5
2024-25 2.8 2.8 2.8
2025-26 3.2 3.2 3.2
10-year total   19.7 19.7 19.7

 

the added additional investment will be $9.5 billion a year. “This will almost double federal infrastructure invest-ment to nearly $125 billion – from $65 billion – over 10 years, which will be the largest new investment in infra-structure in Canadian history.”

The Liberals also promised to de-velop bilateral agreements with the provinces (including Ontario) and terri-tories, “similar to those created for the successful gas tax transfer to cities and communities.”

“We will not only significantly in-crease the sale of federal infrastructure investment; our plan will provide provinces, territories and municipalities with an unprecedented level of long-term predictability in funding as well. This will be done in full respect of provincial jurisdiction.”

To add to more immediate stimulus, the government plans to double federal infrastructure investment in the next two years to $10 billion per year from $5 billion.

The funds will be allocated to public transit, social infrastructure and green infrastructure.

For transit, the government proposes to more than triple federal in over the next four years and quadruple it over 10 years. Specifically, the Liberals say they will boost public transit spending by $6 billion over the next four years and almost $20 billion over 10 years.

Similar allocation/increases will be provided for social infrastructure projects and what the Liberals call “green infrastructure” with priority in “affordable housing and seniors facilities, early learning and child care, and cultural and recreational infrastructure” as well as “local and wastewater facilities, climate resilient infrastructure, clean energy and clean-up of contaminated sites to facilitate new construction.”

The government says it will “reform and increase the transparency of the New Building Canada Fund by providing clearer project criteria and faster approval processes.”

The Liberals say their government “will automatically transfer any uncommitted   federal infrastructure funds near the end of any fiscal year to municipalities, through a temporary top up of the Gas Tax Fund. This will ensure that no committed infrastructure money is allowed to lapse but is always invested in communities across the country.

To add to more immediate stimulus the government plans to double federal infrastructure investment in the next two years to $10 billion per year from $5 billion. 

The government says it will establish The Canada Infrastructure Bank (CIB) to “provide low-cost financing to build new infrastructure projects.”

“This new CIB will work in partnership with other orders of governments and Canada’s financial community, so that the federal government can use its strong credit rating and lending au-thority to make it easier – and more af-fordable – for municipalities to finance the broad range of infrastructure proj-ects their companies need,” the Lib-eral policy statement says. “Lending from the CIB will be linked to bal-ance sheet assets, and will not re-quire any increase in the federal government’s accumulated deficit.

The government says the new CIB will issue Green Bonds “and make green infrastructure projects more attractive to private investors by offering loan guarantees, reduc-ing financing costs and risks, and bundling small projects into attrac-tive offerings for investors.

“The Green Bonds will fund proj-ects such as the electrification of transportation, smart grid technology and transmission lines for renewable energy, electric vehicle charging sta-tions and clean power storage. Where appropriate, the CIB will issue Green Bonds to the public so they too can in-vest in such projects.”

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