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Ontario’s 2019 Budget

Overview

The Ontario budget is expected to be balanced within five years, sometime after the next provincial election.[i]  This is a reversal of a key campaign promise to balance the books within the first term.[ii] In order to reach a surplus of $300 million by 2023-24, the government is relying on predictions that “revenues will catch up with expenses, and in the meantime the Tories plan to strictly limit spending increases.”[iii]  Programs will not be injected with funding, as “program spending this year is projected to inch up from $150 billion (from the fall economic update) to $150.1 billion.”[iv]

What the industry says about the budget

Ontario has long been recognized as being a world-leading automotive manufacturing region. At the start of 2019 at the North American International Auto Show, Premier Ford delivered the message that when it comes to the auto industry, Ontario was open for business. The government took a step forward in January 2019, positioning the province as a player in advanced vehicle technology with the announcement of the updated and extended Automated Vehicle Pilot Program that will “open the door to new automated and connected vehicle research, development and manufacturing opportunities.”[v]

With the release of the 2019 budget, did the Government of Ontario make the sort of investments that show that the province is open for business for the automotive industry?

There are definitely different perspectives out there:

The Positive

The Canadian Vehicle Manufacturers' Association welcomes the 2019 Budget provisions to continue focus on the "open for business" agenda and to reduce costs in the manufacturing sector.  We are encouraged by the province's commitment to find strategies to address automotive manufacturing competitiveness issues and it will be important for the government to work in close collaboration with the industry on these issues and as part of the next phase of the "Driving Prosperity:  The Future of Ontario's Automotive Sector" strategy.”[vi]

The Not So Positive

Unifor Local 200 president John D’Agnolo said he found little positive in the budget, particularly when it comes to the automotive industry.

“We thought they would focus on the great paying jobs we have in Ontario right now, and what can we do to make sure they stay,” said D’Agnolo.

“And there was none of that in this budget. He didn’t really talk about auto. When you talk about positives, I didn’t really get anything.”

D’Agnolo said the government seemed more focused on distracting the public with changes to liquor laws.[vii]

What the budget says about the industry

Below is an overview of three elements of Budget 2019 that matter to the automotive industry:

1.  Driving Prosperity Plan

“Our Driving Prosperity plan will make sure Ontario’s auto sector is the best in the world — and stays that way for years to come.”[viii] 
Premier Doug Ford
  • Plan includes commitment of $40M over 3 years. [ix]
  • Ten-year plan to create the conditions to grow auto industry.[x]
  • Multi-stakeholder approach: industry, research, education sector and all three levels of government. [xi]
  • Three strategic pillars to the plan: Competitive Business Climate, Innovation and Talent.[xii]

Competitive Business Climate 

Modernize regulations and reduce red tape

Enable investments and partnerships

Support market diversification

Reduce business costs and taxation[xiii]

Innovation

Support new mobility technologies

Enhance the innovation ecosystem

Promote small and medium-sized enterprise technology adoption

Support research and development and early stage technology development

Increase commercialization and scale up of technology[xiv]

Talent

Promote careers in advanced manufacturing

Leverage industry input

Enhance and raise awareness of existing employment and training programs

Strengthen and formalize Ontario’s technical education pathways[xv]

2.  Apprenticeship

"Apprenticeship training is an essential pillar in Ontario's post-secondary system. This budget recognizes that an apprentice is equal to any other post-secondary student and will help elevate apprenticeship training in Ontario to international standards."[xvi]
Linda Franklin, President and CEO of Colleges Ontario
  • “One-window” application process for apprenticeship training enrolment [xvii] 
  • A financial incentive program to support employers to participate in the apprenticeship system by training apprentices.[xviii]
  • Promoting apprenticeship and the skilled trades as a career pathway to Ontario youth beginning in kindergarten to Grade 12.[xix]

3. Skills Training

  • Plan to redesign Second Career and other skills training programs. The plan includes supports to employers who want to invest in training for their workforce and the launching of “a micro-credentials pilot, which will create new, responsive training programs to help people develop the kind of in-demand skills that employers are seeking”.[xx]
  • To attract people with the skills that businesses need, the budget proposes enhancements to the Ontario Immigrant Nominee Program (OINP). The OINP allows Ontario to nominate for permanent residence people who have the professional and educational skills needed to contribute to the province’s economy.”[xxi]
 

[i] Bond,M. (April 11, 2019). 4 key priorities: Breaking down Fedeli’s budget speech. 680 News. https://www.680news.com/2019/04/11/fedeli-budget-speech/

[ii] Walsh, M. (April 11, 2019). Ford government breaks campaign pledge, will balance budget in five years. iPolitics. https://ipolitics.ca/2019/04/11/ford-government-breaks-campaign-pledge-will-balance-budget-in-five-years/

 [iii] Walsh, M.

[iv] Walsh, M.

[v]Ontario Ministry of Transportation. (Jan. 22, 2019). Changes to Ontario’s Automated Vehicle Pilot. Ontario Newsroom. https://news.ontario.ca/mto/en/2019/01/changes-to-ontarios-automated-vehicle-pilot.html

[vi] Canadian Vehicle Manufacturers Association. (April 11, 2019). Canadian Vehicle Manufacturers’ Association Statement on the 2019 Ontario budget. Cision. https://www.newswire.ca/news-releases/canadian-vehicle-manufacturers-association-statement-on-the-2019-ontario-budget-835398357.html

[vii] Thompson, C. (April 11, 2019). Labour, business leaders weigh in on Ontario budget. Windsor Star. https://windsorstar.com/news/local-news/labour-business-leaders-weigh-in-on-ontario-budget

[viii] The Honourable Victor Fedeli, Minister of Finance. (April 11, 2019).  2019 Ontario Budget: Protecting What Matters Most. Ontario Ministry of Finance. http://budget.ontario.ca/2019/chapter-1d.html#section-2

[ix] The Honourable Victor Fedeli, Minister of Finance.

[x] The Honourable Victor Fedeli, Minister of Finance.

[xi] The Honourable Victor Fedeli, Minister of Finance.

[xii] The Honourable Victor Fedeli, Minister of Finance.

[xiii] The Honourable Victor Fedeli, Minister of Finance.

[xiv] The Honourable Victor Fedeli, Minister of Finance.

[xv] The Honourable Victor Fedeli, Minister of Finance.

[xvi] Canada News Wire. (April 11, 2019). Canadian Insider. Colleges applaud Ontario budget commitment to modernize apprenticeship training. https://www.canadianinsider.com/colleges-applaud-ontario-budget-commitment-to-modernize-apprenticeship-training

[xvii] Canada News Wire.

[xviii] The Honourable Victor Fedeli, Minister of Finance.

[xix] The Honourable Victor Fedeli, Minister of Finance.

[xx] The Honourable Victor Fedeli, Minister of Finance.

[xxi] The Honourable Victor Fedeli, Minister of Finance.