- Media Type
- Item Type
- November 4, 2013 CREATING JOBS AND GROWING THE ECONOMY
- Date of Publication
- 4 Nov 2013
- Date Of Event
- 04 Nov 2013
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Chairman: Noble Chummar
President, The Empire Club of Canada
Head Table Guests
M.J. Perry, Vice-President and Owner, Mr. Discount Ltd., and Director, The Empire Club of Canada; Chris Carson, Chief of Staff to the Deputy Premier of Ontario and Minister of Health; The Hon. David R. Peterson, Chairman, Cassels Brock & Blackwell, Chairman, Toronto 2015 Pan American Games, and Former Premier of Ontario; Paul Zed, Chairman, President’s Advisory Board, Cisco Systems Canada, and Former Member of Parliament; Christopher May, Director of Government Affairs, CPA Ontario; Thomas Teahen, Chief of Staff to the Premier of Ontario; Rob. Scullion, Chair, CPA Ontario, and Partner, Ernst & Young; and Andrea Wood, Vice-President, Legal Services, Telus, and 1st Vice-President, The Empire Club of Canada.
Introduction by Noble Chummar
Being the guy who holds the purse strings is a huge responsibility. In our daily lives, we must make financial decisions that impact our families, our future and our standard of living. A family holiday in Europe? Renovating a home for an elderly parent? Or putting money aside for university education. All priorities. All important. Only one problem—money is not infinite.
Minister Charles Sousa was born and raised in Mississauga, has been the Member of Provincial Parliament for the riding of Missisauga South since 2007, and is the current Minister of Finance for the Province of Ontario.
He is a husband and father, and former Bay Street banker, labour minister and minister of citizenship. Minister Sousa is a graduate of Wilfrid Laurier University and received his MBA from the Ivey School of Business.
On Thursday, Minister Sousa will rise in the legislature to deliver the government’s fall economic statement. Charles Sousa is known for always saying: “In Ontario, there is room for everyone.”
Ladies and gentlemen, please join me in welcoming the Honourable Charles Sousa to the Empire Club of Canada.
Well, thank you, Noble. I appreciate the introduction. I appreciate you giving my speech. That was great. It’s pretty much done. Thank you very much for coming.
Actually, Noble has been doing an outstanding job for a lot of years with a lot of files and a lot of initiatives; and Noble, we really appreciate your advocacy and the work you do. Thank you so much.
I’d also like to thank our former premier, David Peterson,
who’s here today in fine form. The guy’s looking better with age.
In fact, he looks the same as he always did, almost as good as Hazel McCallion. I have such great respect for our former premier for all that he’s been doing and more importantly, this man gives back to the community in a huge way. Now as Chair of the PanAm and ParaPanamerican Games of which he was instrumental in landing, he is now the biggest cheerleader there is to ensure that those games make Ontario proud. Mr. Peterson, we’re proud of you so thank you for what you do.
Of course, the former premier didn’t come alone. He had to bring some back-up. He brought his former minister, Bob Wong, who’s here today. Where are you, Bob? There he is. Thank you so much for being here.
I think Steve Mahoney is here as well. He has been involved in every order of government. Thank you, Steve.
As Treasurer, I have a boardroom and in the boardroom there are all kinds of pictures and I look at this woman almost every day and to have her here again today live is such a great pleasure—Janet Ecker, former Finance Minister and also Chair of the Toronto Services Financial Association.
I didn’t come alone either. I brought one of my colleagues, Soo Wong, one of our newest members in caucus who is doing a fantastic job.
Actually, she replaced a prince of a man. This individual has been with us a long time even during the days of David Peterson and I should tell you that this man continues to work for us still. He was former chair of the Treasury Board. He was minister of pretty much everything in government and he continues today to help me as a mentor and as a guide and he sits on my Treasury Board still doing good work. Thank you so much, Gerry Phillips. Of course, there are a lot of other distinguished guests here as well and I just want to welcome all of you ladies and gentlemen. Thank you and good afternoon. Thank you for taking time out of what I’m sure is a very busy day for all of you. I know and you know that I’ve been treasurer for about a year now. My life has changed quite a bit. My youngest daughter is a teenager so some of you who are parents of teenagers will appreciate this. I’m not really used to people paying close attention when I’m speaking. She didn’t even come here today so before I begin I just want to say thank you for listening and I want to thank my son, who did come. Thank you Justin for being here today.
I also want to thank all of you for all you do day in and day out and the work that you do and the jobs that your work supports to build a stronger Ontario, a more compassionate Ontario, a fairer Ontario.
Later this week, our government under the leadership of Premier Kathleen Wynne will be tabling our fall economic statement. Today, I want not so much to provide you with a foretaste of the content of the statement, though I may do a bit of that, but mostly to talk about the context; the careful deliberation and the planning that has gone into creating our new economic plan.
First though, let me tell you what it is not. It is not a plan that supports drastic cuts, across-the-board cuts to vital programs and services that Ontarians rely on and that families require and that support a strong economy. We know that this is what some have done in the past and suggest we do again. We reject that approach and we reject it both on principle and non-experience.
When we took office in 2003, we had three deficits to contend with. More than a $5-billion fiscal deficit, which the previous government had run-up and hid despite relatively good times and a strong global economy no less. There was an education deficit, caused by years of neglect and cutbacks in the classroom. That meant untold hours of instruction lost to a generation of Ontario students and an infrastructure deficit in the form of crumbling bridges, poorly maintained roads and highways, and chronically underfunded and inadequate transit.
It has taken us a decade of hard work and strategic investments to begin to repair that unfortunate legacy and while we have introduced successive balanced budgets in good economic times, the reality is that the global recession that was placed on Ontario’s doorstep has meant we find ourselves in a fiscal deficit like so many others. But the good news is that we have a solid plan to grow our economy and we are on track to balance the budget by 2017–18.
In the other two areas, education and infrastructure, we have also made significant progress. Despite today’s economic challenges, we choose to continue to invest in our future. Today across Ontario, more students are graduating from high school than ever before. More students are doing post-secondary education than ever before. Test scores are higher, class sizes are lower, and Ontario’s education system is internationally recognized as one of the best in the world. This means that our young people are better equipped, better trained, and better able to compete in the global economy that prizes innovation, education and entrepreneurship more than ever. We’ve also introduced new pro- grams that increase financial literacy in our schools, and that’s encouraging.
To address the infrastructure deficit we have refurbished 7,900 kilometres of roads and highways, enough to stretch from Toronto to Calgary and back. We’ve added new trains, longer trains, more trains, including a 30- minute all-day service on the vital GO Tran- sit corridor, that helps alleviate traffic on our highways and gets goods and people moving more quickly and more safely, as well as providing better public transit within communities, big and small, all across Ontario. Our partners at Metrolinx have done a tremendous job in that regard.
And yet, we need to do even more, which is why last week we announced that Ontario will be the first province in Canada to develop and sell green bonds. The proceeds from these bonds will be directly invested in transit and in environmentally friendly projects right across our province.
But we’re not done. More needs to be done. I live in Mississauga. I’m a commuter and I can tell you I’ve spent so much time looking at people’s cars on the Gardiner Expressway that I think I’ve read every bumper sticker in Ontario and we’re all there, stuck, just trying to get to work.
I even had the opportunity to hear the premier and Darryl Dahmer give a bird’s eye live traffic report further reinforcing the critical need for us to invest. This log jam costs our economy
$6 billion per year in the Greater Toronto and Hamilton areas alone and we all feel the effects.
So when other parties call for drastic cuts, especially given that we are the only government in over a decade to have actually reduced total spending, the fact is that we are already the lowest-cost government anywhere in Canada. I can only think of the chaos that reckless cuts would cause to our economy. I think of the increased loss to our productivity. I think of the nurses and doctors out of work and how it would hurt our ability to care for our seniors, our sick and our vulnerable. I think of the brownouts and the black-outs we suffered. I think of the years we lost in our schools and how hard and how long we fought to restore fairness and create greater competitiveness, so we reject that approach on principle.
Ontarians know that cuts made are only expenditures delayed. Simply kicking the can down the road for future governments to deal with is unacceptable. People reject that nearsighted vision and so do we, and then there are others who suggest uncontrolled spending and reckless taxes on our job-creating businesses just at a time when the global economy is in the midst of a fragile recovery. We reject that approach too on principle, because Ontario families rely on those jobs. They rely on our businesses and entrepreneurs to thrive and compete and on our ability to attract new investment.
As today’s Ontario government, we have a different principle—one that is informed by a practical and pragmatic approach to the new realities of a highly competitive and global economy and one that leverages the competitive strengths we have all worked so hard to achieve. We will reduce Ontario’s net debt-to-GDP ratio to its pre-recession level of 27 per cent. This is a measure of our ability to afford debt, because we cannot afford to pass that burden on to our children, even if they don’t always listen to me, or you. We will grow our economy. Stronger growth and new jobs is the surest, fastest path to higher revenues and a balanced budget. Not drastic cuts or business-killing taxes, but by growing the economy and creating jobs and as we do, we will continue to provide predictability and stability for Ontarians and our businesses, and we will continue working hard to strengthen and ensure that all regions of this province benefit from a strong and growing economy.
We will also continue to take action to reduce costs for consumers, particularly when it comes to auto insurance. Our strategy calls for a 15-per-cent reduction in auto rates on average. Last week, I received an interim report from Justice Cunningham on ways to improve the dispute resolution system. The system suffered a significant backlog delaying support for victims and that back- log keeps costs high. We must correct that. Mr. Cunningham has outlined recommendations towards a quicker and more efficient model for resolving those disputes. In the next few weeks, we’ll release the report and work with our partners to get it done.
Responsibility and fairness are the principles that guide us and they’re not only the principles of our government, not only the principles embraced by Ontario families. I share them as well. I’m a son of immigrants. I was born just a few blocks away in Kensington Market. My parents came here from Portugal, because they saw Ontario as a place of opportunity. As my dad, likes to say, “In Ontario, there is room for everyone, room for everyone to compete and do business, room to learn and above all, room to help one another.”
I stand before you as proof that he was right. Dad, take a bow. Because of him, I had that opportunity. I attended Ontario public schools. I got my degrees from Ontario’s publicly funded universities. I worked in Ontario’s thriving financial sector, one of the strongest in the world. My children were born in Ontario’s public hospitals and at every step of the way throughout my whole life, I’ve been given the room to compete and do business, to learn and to help others. What is remarkable about that story is how typical it is, how it is shared by so many of us in this room and across our province. Friends, you have invested in my family and I have invested in yours and that’s the way it should be, because we know that working together we can achieve so much more than we can alone and that is the beauty of Ontario.
It is a place that is as compassionate as it is competitive, as fair as it is prosperous and that balance, one that is at the heart of our civil society, is just as important as the financial balance on the books because it is also a competitive advantage in the global economy and our Ontario Liberal government will protect that balance always.
And at the same time, we’ll continue to create an economic climate that allows Ontario’s businesses to thrive. Already we have created a stable and competitive business climate by cutting taxes, which includes reducing corporate income tax and eliminating the capital tax. This encourages new business investment and helps to create jobs.
We also just introduced legislation to cut employer health tax for 60,000 more small businesses and, if passed, beginning on January 1 almost 90 per cent of Ontario businesses will not pay this tax. But as we head towards January, the Opposition has been holding up this bill. These political gains will hurt small businesses right across our province. Our measures have allowed businesses to save money, to keep it on their books to eventually invest in new equipment and machinery to become even more competitive and productive, and to train and hire people to achieve even greater success. But here again, Ontario needs to do more.
I think many of you have been aware of recent studies and reports by Deloitte, CIBC and others that show many companies are not taking advantage of the opportunities to expand, innovate and improve their productivity. Instead, many companies are holding high levels of cash, holding back on these very investments. As a former banker, I appreciate the contradiction here. On the one hand, having cash on the books can be a good thing given it’s a function of working capital. A strong balance sheet provides businesses with great security and positions them for growth pro- vided that surplus cash is invested, because not doing so is what limits our competitiveness. In an uncertain global economy, in a fragile recovery, certainly a measured approach to new investment makes sense.
The majority of the U.S. states provides R&D tax credits targeted to incremental R&D expenditures. Ontario and Canada’s R&D spending as a proportion of GDP remains significantly lower than that of the United States. That in turn allows the U.S. competitors to produce goods and services more productively. This is a race. We can’t fall behind. We can’t falter and we can’t be faint of heart just as our government is making the necessary in- vestments in health care and education and infrastructure so that Ontario has a solid backbone to compete and win in the global economy.
As Ontarians, we’re always striving to work together. The government will play its part, but it’s businesses that create jobs. So we’ll do more to help them to become even more competitive by encouraging investments in new machinery and equipment and in other ways to boost productivity. We’ll consider measures already taken by other parts of the world to promote capital investment. These include R&D tax credits to reward additional spending and the pay tax incentive for new spending in equipment, technology and training. We’ll also partner with industry to measure and report on those investments in innovation, training and technology and showcase top performers against international benchmarks.
We’ll do so because we know on principle we can’t cut our way to success, because that only results in a race to the bottom. We can’t tax our way to success, because that strangles our ability to compete. We only grow our way to success by creating an environment that our job-producing businesses need to succeed. That insurance supports the strong economy we need, which in turn supports our vital public services, like health care and education that our families, yours and mine, depend upon. That’s the principle we’ll follow. That is an approach that is fair and balanced in every sense of the word.
Ladies and gentlemen, this is an important time for Ontario. As the world recovers, as the challenges and changes in the global economy continue to play themselves out, we won’t sit still. We in Ontario are leading the way to finding a Canada-wide agreement on CPP enhancement. Last week, I met with other finance ministers and, for the first time, we agreed on a set of objectives of how to move forward on pension reform.
We’ve also recently made headway on a cooperative securities regulator. Ontario along with British Columbia and the federal government has established a framework to have a more competitive and effective system. That is not only good for Ontario. It’s also about building a stronger nation for people and businesses all across Canada.
We will not rest on what we’ve achieved together though. We will continue to invest. We will not cut for the sake of cutting. Those actions that hurt families and take our economy backwards are not where we’re going to go. We will continue to build and improve our productivity and encourage businesses to invest and create more jobs. We remain on track to balancing the budget by 2017–18, because we will continue to create the conditions for economic growth by investing in people, building modern infrastructure and supporting a dynamic and innovative business climate, and we’ll do this in a way that is fair, that is balanced and principled, and we’ll ensure that Ontario remains what it has always been—a place where there is room for everyone, room
for everyone to compete and do business, room to learn and above all, room to help one another.
The appreciation of the meeting was expressed by Christopher May, Director of Government Affairs, CPA Ontario.