Provincial Budget 2024 - Building Ontario’s Future Today

March 22, 2024

The Empire Club of Canada Presents

Provincial Budget 2024: Building Ontario’s Future Today

Chairman: Sal Rabbani, President, Board of Directors, Empire Club of Canada

Moderator
The Honourable Lisa Raitt, Vice Chair, Global Investment Banking, CIBC Capital Markets

Distinguished Guest Speakers
Dan Stark, Financial Services Industry Lead, Canada, Amazon Web Services
The Honourable Peter Bethlenfalvy, Minister of Finance, Government of Ontario
Andrew Spencer, EVP Capital Portfolio Delivery, Hydro One


Head Table Guests
Jacqueline Dawes, CEO, CRS Packaging Inc.
Joanne De Laurentiis , Chair, Financial Services Regulatory Authority
Amanda Dean, Vice President, Ontario & Atlantic, Insurance Bureau of Canada
Julianne Den Decker, Senior Vice-President, Major Projects, Nuclear, Canada, AtkinsRéalis
Jenna Donelson, Executive Director, Government Relations, Queens University, 1st Vice-Chair, Empire Club of Canada
Kevin Kelly, Executive Vice-President, Finance, and Chief Financial Officer, Bruce Power
Paul Lehmann, Head Enterprise Public Affairs and Communications, BMO
Victoria Mancinelli, Director of Public Relations, Marketing and Strategic Partnerships, LiUNA
John McKenzie, CEO, TMX Group
Rosie Orlando, President, Primerica Life Insurance Company of Canada
Juwon Roland, BA Candidate Class of 2027, Trinity College, University of Toronto
Matthew Rossetto, President, MPAR Developments
Matthew Turack, Group President, CAA Insurance
Karen Werger, Vice Chair, Global Leader Valuations & Modeling, Deloitte LLP
Julia Zhang, President & CEO, JD Development Group

Introduction
It is a great honour for me to be here at the Empire Club of Canada today, which is arguably the most famous and historically relevant speaker’s podium to have ever existed in Canada. It has offered its podium to such international luminaries as Winston Churchill, Ronald Reagan, Audrey Hepburn, the Dalai Lama, Indira Gandhi, and closer to home, from Pierre Trudeau to Justin Trudeau; literally generations of our great nation's leaders, alongside with those of the world's top international diplomats, heads of state, and business and thought leaders.

It is a real honour and distinct privilege to be invited to speak to the Empire Club of Canada, which has been welcoming international diplomats, leaders in business, and in science, and in politics. When they stand at that podium, they speak not only to the entire country, but they can speak to the entire world.

Welcome Address by Sal Rabbani, President, Board of Directors, Empire Club of Canada
Good afternoon. And welcome to the Empire Club of Canada. My name is Sal Rabbani, and it's an honour to stand before our community, as Chair of the Board of Directors of the Empire Club of Canada.

To formally begin this afternoon, I want to acknowledge that we are gathering today on the traditional and treaty lands of the Mississaugas of the Credit, and the homelands of the Anishinaabeg, the Haudenosaunee, and the Wendat Peoples. We encourage everyone to learn more about the Traditional Territory on which you work and live.

It's an absolute honour to welcome on our stage the Honourable Peter Bethlenfalvy, Minister of Finance for the Government of Ontario, who will deliver a keynote speech, followed by a fireside chat with the Honourable Lisa Raitt, Vice Chair, Global Investment Banking, CIBC Capital Markets, who will moderate the discussion today. Welcome, and thank you both for joining us.

The Empire Club is a not-for-profit organization, and we'd like to recognize our sponsors, who generously support the club, and make these events possible and complimentary for our online viewers to attend. Thank you to our Lead Event Sponsors, AWS, Bruce Power, Hydro One. And thank you to our VIP Reception Sponsors, Atkins Réalis, BMO, CAA Insurance, IBC, LiUNA, Primerica, and TMX. And thank you to our Supporting Sponsors, Aurora Strategy Global, CPA, Fidelity, Humber College, Aria, Rios, Think Research, and Waste Connections. And thank you to our Season Sponsors, AWS, Bruce Power, and Hydro One.

As always, we accept questions from the audience for our speakers, and you can undertake to scan that QR code found in your program booklet. And for those of you joining us online, you can ask questions through that Q&A portal under the video player. Please engage in the conversation, as this is an important one about the future of our province.

We're five days away from the moment when Ontario, the Ontario Provincial Budget, the 2024 budget, will be revealed. It has become a tradition for the Minister of Finance to deliver the pre-budget address at the club. And as for Minister Bethlenfalvy, this is his fifth time before the podium, but his third consecutive year on our stage as minister, and Minister, we're happy to see you, and listen to how the government is taking action, where, and with what anticipated results. Yes, this year's context is complicated, to say the least. Like Canada and the rest of the world, Ontario's economy continues to be under pressure, and the business community is reacting to this outlook.

A few weeks ago, we hosted the Ontario Chamber of Commerce Economic Report launch, and what we heard is that business confidence was declining agriculture. Agriculture, nonprofits, and health were the least confident sectors; and the most confident was mining and utilities. Labour shortages, debt, and the future of the economy are the biggest worries of our business community. Affordability, weak consumer demand, inflation. Now, these challenges aren't specific to our province, not even to Canada; they're global. But they exist, and they persist.

Productivity, productivity remains the number one business topic and a recurrent theme in our conversations at the club. Ontario's competitiveness as Canada's largest economy, as well as the renaissance of our manufacturing sector, depend on our capacity to do more with less, work smarter, and invest in technology and automation. You know, I've been working with small and medium-sized businesses for many years now. And the productivity issue has always been present. But never as present as it is now. The rise of global competition, of artificial intelligence, and sluggish economic growth just make the productivity imperative more urgent than ever. And there is a good piece of news, and that is, despite this challenging economic situation, Ontario businesses are still seeing growth on the horizon, which for me, represents an incredible signal of innovation and resilience. And yes, business owners are worried about the economy. But they want to grow, and they see the growth potential in Ontario. There's determination, grit, a lot of people, and a lot of incredible talent, and a ton of potential in our business community.

Last year during his budget speech, the minister took us on a symbolic road trip across Ontario, to allow us to appreciate, you know, some of the work that he was undertaking, and some of the investments, and how our province has become a global EV manufacturing powerhouse. And it was truly an inspiring discussion. The minister's anecdote came to mind, when I started to prepare for today's event. How far can we go? How much potential can we unlock in this province? And yes, the road might get bumpy from time to time, but Ontario is in the very front seat to continue to lead and prosper, capitalize on our strengths, and build the best Ontario we want for us, and for our future generations. So, Minister, we're looking forward to seeing what you have prepared for us today, on this year's journey. It's now my pleasure to kick off with a video from our Lead Sponsor, Bruce Power.

[VIDEO:]
Nuclear power is lighting the path to the future. A future where clean, reliable electricity meets rising energy needs, a future with a prosperous economy founded on job growth, a future where new medical isotopes triumph over disease. For decades, Bruce Power has provided clean, reliable energy to Ontario, and cancer-fighting isotopes across the globe, and will continue to play a vital role in powering a clean economy for the next generation.
[END OF VIDEO]

Sal Rabbani
Thank you. Thank you. Now, I'd like to invite to the podium Dan Stark, who's the Financial Services Industry Lead for Canada for Amazon Web Services, for the introductory remarks. Dan, welcome.

Opening Remarks by Dan Stark, Financial Services Industry Lead, Canada, Amazon Web Services
Good afternoon. I'm Dan Stark. I lead the financial services team in Canada for Amazon Web Services, the cloud computing division of Amazon. I'm honoured to be here today as a proud Ontarian to introduce our distinguished speaker, the Ontario Minister of Finance, the Honourable Peter Bethlenfalvy, who is here to speak to us in advance of next week's budget.

One of the themes the Minister will speak about is the need to continue to invest in critical infrastructure for the future, while keeping costs down for Ontarians today. It's a timely conversation, given recent statistics indicate a need for increased growth and productivity in the Canadian economy. As Canada's most populous province, and with the largest GDP, this is an especially important message. As we've heard from the Ontario government—and as I suspect the Minister will reiterate today—the future of Ontario is filled with opportunity. It's a message that I'd also like to take a moment to reinforce. Much like the Ontario government, AWS, or Amazon Web Services, is focused on driving innovation and enhancing core operations for our public and private sector customers, with the ultimate goal of enhancing service delivery, and driving growth.

At AWS, we are going all in on Canada and Ontario. We're planning to invest an estimated 24.8 billion dollars throughout the country, by 2037, in new and expanded infrastructure regions, or data centres. Toronto is the home to one of AWS's major technology hubs, which employ over 3,500 people in highly skilled roles. From software engineers to data scientists, these individuals are constantly innovating and contributing to the economy, right here in Ontario.

Next year, we'll be launching our first AWS Local Zone in Toronto. Local Zones are a type of infrastructure that brings cloud services closer to our customers, and enables them to leverage the latest cloud technology. We're doing this in a sustainable way, as well. Amazon is the world's largest purchaser of renewable power, and we're committed to providing renewable power for 100 percent of our operations by 2025. [Applause] Thank you. Across the wider Amazon family, we employ over 25,000 people throughout the province, with many of these people using our latest technology to deliver packages to your door really quickly. Based on some of the conversations I had on the way in, I also think a "Thank you for your business," is in order in that respect, as well, to the room.

Artificial intelligence is of particular interest to our customers, a technology that Amazon has a long history of being on the leading edge of. From Alexa, to hundreds of thousands of our customers using our AI cloud services, to cutting-edge robotics in our fulfillment centres, AI is in our DNA. We are actively bringing AI, and generative AI capabilities to all types of customers, including large, complex, and highly-regulated businesses, like SunLife, here in Toronto.

A couple of weeks ago, we announced the availability of Claude 3, the newest model from our partner Anthropic. Claude 3 outperforms its peers on most of the common evaluation benchmarks for AI systems, and is the new market leader. We also work closely with Cohere, another industry-leading AI provider for the enterprise, based right here in Toronto. We're proud to partner with thousands of financial services firms, from the fast-growing FinTech's to the largest Canadian financial institutions. In my role, I have the opportunity every day to see how investments in technologies like cloud are boosting the productivity of our financial services customers, and driving better outcomes for Ontarians. As an example, one of our financial services customers migrated all eight of their data centres to AWS, leading to a reduction in application development time for new infrastructure, more rapid innovation, the ability to unlock and power their data, as well as a dramatically reduced carbon footprint.

The cloud has the ability to transform the way government serves the people of Ontario, as well, making government IT more flexible, innovative, and cost-effective. All of which contributes to a better citizen experience, while saving government money. In addition, the cloud makes it much easier for a wider range of suppliers to provide for the public sector, reducing costs, and unlocking new models of service delivery. There is still work to be done, though. We have a key opportunity to accelerate the uptake of technology by small businesses, who form the backbone of our economy. By reducing barriers to entry, and the need for expensive upfront IT investments, the cloud's pay-for-what-you-use model can help businesses grow and thrive. At a national level, increasing cloud adoption among small businesses by even 15 percent can increase gross value added by over 4.2 billion dollars. It's an exciting time for AWS to be partnering with businesses and organizations across Ontario. We're honoured to play a role in helping accelerate innovation and economic growth in Canada's powerhouse province.

On that note, I'd like to turn it over to our guest speaker, who continues to be a key advocate for innovation and growth. Please welcome the Minister of Finance for Ontario, The Honourable Peter Bethlenfalvy.

The Honourable Peter Bethlenfalvy, Minister of Finance, Government of Ontario
Wow. It's so cool to come up to the stage listening to Coldplay. It really pumps me up. You know, and some of you may know, or may not know that I play guitar, and I play, every August to do a barbecue in Pickering. So, if you—this is cool, and this isn't too stressful. But getting up on the stage, playing guitar in front of your constituents? Now, that's stressful. So, if you want to see a minister get stressed, come out next August. Thank you, Dan, for that. You know, you said a lot of things there. And you know what I heard? 25 billion. That's what I heard. The investment in Ontario and Canada. I mean, folks, that is exactly what our vision is about. And thank you to AWS and the whole Amazon family. I recently toured one of your distribution fulfillment facilities in Ottawa—and folks, if you ever have a chance to go into one of these fulfillment centres, I mean, you talk about the future, it's right there, and it's right here.

I'm going to get into my remarks. I'm going to keep them brief, because I love the Q&A, that's where I love to go. And I do want to thank upfront Lisa Raitt, for doing the Q&A. I was listening to 1010 this morning, and John Tory. And he asked Lisa if, you know, "Will you run again? Will you run?" You know, who wouldn't like Lisa Raitt, a great Canadian politician, to run again? I think I kind of screwed up there, because she's pissed off, I can see she's pissed off at me for doing that, so, maybe the questions will be just a little bit tougher—"You bet they are," she says. Well, thank you, folks, and it's great to be here, and really appreciate it. You know, so many familiar faces. Yeah, it's my fifth time—thanks, Sal, very much, for that—but we did have a little pandemic in there, otherwise, it would have been a bit more. But we got through it.

I do want to acknowledge, I believe three of my colleagues are here, and if you are—Mike Harris Jr., Anthony Leardi, and Trevor Jones, are you here? Stand up. There's Trevor, there's Mike. Yeah. You know, folks, I have so much admiration. I know we have some of our colleagues from the other side here, as well. You know, I admire anyone who puts their name on a ballot. You know, we have big thanks to all who serve the public. As John Turner said, you know, "Democracy doesn't happen by accident. Democracy is hard work." And I have so much admiration—I think I'm looking at a former MPP. Yes, I am. Terence, who [Applause]—yeah, Terence from the NDP, who represented Essex, and did a great job. So, thank you. You know, he knows what I'm talking about. You put your name forward, you represent your constituents. We duke it out every four years, but then we get to work, on behalf of all 16 million people in this province.

So, folks, I want to thank everyone for putting on this event. Oh, I do want to—I'm looking, also, I've got, I think I have my deputy minister of finance? Where are you, Greg Orencsak? Are you here? Oh yeah, there he is. He's about 6'10; can't miss him. A fellow Hungarian, by the way—who would have thought that two Hungarians would be running the whole province, financially? But there you go. You got us. And your team, many of your team are here, Deputy. And I just want to thank, you know, there's another tireless, tireless group of people in the ministry: public sector workers. I couldn't do my job—some of my political staff are here, I see my former chief-of-staff, Richard Clark, here, and Emily Hogeveen in the back, and others; Todd, Jerry. Folks, these guys work 24/7, they work around the clock. It's not easy running a province. We have to compete. We're not an island in Ontario; we're competing against the world. And I want to give a big shout out to our public sector workers. So, thank you, Deputy.

So, thanks for giving me the opportunity to talk about the current state of our province, and what the future holds. You know, that's, you know, what we have to recognize that, much of the, like the rest of the world, Ontario is facing economic challenges. And all these certainly have had an effect on the province's finances, and on those of other jurisdictions. We saw a little bit of economic growth throughout the last year. And I'll tell you, that comes, in that sea of economic turbulence, it comes as a result partly of our province's people and businesses' tried-and-true ability to overcome all obstacles, and as a result of our government's clear understanding that in order to succeed, you need a vision, you need a plan. A plan to get us there.

You know, we lost a great Canadian last week. A great Canadian. My condolences go out to my colleague Caroline Mulroney, a great president of the treasury, a great colleague, and her entire family. You know, folks, Brian Mulroney was a visionary leader. He took on opportunities to create the conditions for the economy we have today. From free trade to tax reform, he believed in the free market, and put the tools in place to make it happen, which is precisely where my responsibilities as Minister of Finance begin. And as, you know, as was mentioned by Sal and others, I will be releasing Ontario's 2024 Budget next Tuesday. And I can tell you with confidence that amidst this period of economic uncertainty and global instability, our government has a plan to build a better Ontario for you, to build a better Ontario for your children, and to build a better Ontario for your grandchildren. And so, over the course of this last year, we have worked tirelessly on our plan to put Ontario on the path towards a promising future. We're taking steps to get shovels in the ground now. Our plan will build the strong communities Ontario needs, now and for tomorrow. Our plan gets more shovels in the ground to build critical infrastructure, like homes, like roads, like transit, and to get it built faster.

In fact, just this morning, I was up in Richmond Hill—by the way, it was freezing up there, I gotta tell ya, if you've ever been up there, I don't know what's going on in Richmond Hill, but it was freezing—I joined the premier and Minister Surma to announce a 1.8-billion-dollar fund to build more housing-enabling infrastructure, and to support municipalities right across this great province.

Our plan supports workers and families facing the pressures of inflation and high-interest rates, by providing the services they need, while keeping their costs down. Our plan delivers all these needs and more, all the while maintaining a prudent and targeted approach to fiscal management. You know, as part of my work leading up to this year's budget, I travelled for weeks across the province to meet with people, and hear their thoughts on the direction they would like to see our province moving in. Municipal and community leaders, healthcare providers, workers, families, educators, business owners, both large and small; people from all walks of life. And what I hear time and time again is that everyone, no matter who they are, or what they do, they continue to have confidence to invest in themselves, their businesses, and their communities. They have confidence in our government's plan to get it done. Our job is to support the people of Ontario, as we work together to build the best place in the world to live, to work, to raise a family, and to do business.

And that's why we are cutting costly red tape, and creating good-paying jobs, with higher wages for workers across the province. [Remarks in French]. We have helped attract historic automotive and clean steel investments. And along with our First Nations partners, we have helped harness the near-limitless potential of Northern Ontario's critical minerals. And we see even more opportunities on the horizon. We have the most ambitious capital plan in the province's history, with billions over the next decade going towards leveraging our economic and population growth to generate the best results for families, for businesses, and for newcomers. And we're building the roads and highways we need to meet that growth, from the Manitoba border, down to the Niagara River, and back to Windsor.

And speaking of Windsor, our government is investing 50 million dollars there, to build a new interchange at Banwell Road and E.C. Row Expressway, improving access to Canada's first electric vehicle battery plant, and further establishing Ontario as a world leader in the electric vehicle revolution. It is phenomenal what's happening. We, the premier and I were there last Monday, a week ago Monday, in the Stellantis and LG plant, the battery manufacturing; 45 million square feet. They've already started production, they're building out the rest of it. That's creating good jobs, that's creating big paychecks, that's creating a technology transfer from South Korea-to Ontario-to Windsor, coming here to Canada. That's employing construction workers, skilled trades. But we need more homes, we need more infrastructure, to make sure that we can accommodate that growth. And that's why we're moving forward with building Highway 413 across Halton, Peel, and York Regions, to move people and goods faster, and to relieve congestion in the growing Greater Golden Horseshoe. And if you don't believe me, go drive in Brampton, and see how much gridlock there is there. And our modeling shows that if we don't build these roads right now, in 10 years, we will be at gridlock in all 400-series—in other words, no going over 40 km an hour. You will be in gridlock if we don't build those roads. In fact, our modeling shows that by 2051, in the main corridor of the 401 in the GTHA, your drive will be 90 minutes longer. And it takes time to build a road. You've got to have a vision for the future. You can't just wake up one day and say, "Holy crap, we're in gridlock." You've got to think about the future and the road ahead, especially when you've got half a million people coming to this province every year.

You know, when two years ago, our population was 15 million; it's now over 16 million in two years. Net population growth. We're a beacon of hope and stability around the world. People want to come to Ontario. They want to come to Canada. So, together, we have to think down the road a little bit, and make sure we've got the schools, that we've got the roads, we've got Highway 403, the Bradford Bypass, you name it. We've got to do it. And, you know, folks, we're leading the largest transit project expansion in North America, including priority subway projects, right here in Toronto. You wouldn't believe it. We're, we've got shovels in the ground, they're tunneling on the Eglinton-West, they're tunneling in Scarborough, the Ontario Line, the Yonge extension. That's four subway lines at the same time being built right now, so we can take cars off the road and get through gridlock.

But our plan doesn't stop at building critical infrastructure. Our plan remains laser-focused on supporting people and families that make up our province through these challenging times. And we know that many people and many families are feeling the financial pressures of inflation, feeling the pressures of the Federal Carbon Tax, and the high Bank of Canada interest rates. And I'm here to tell you that our government understands that. As much potential as Ontario has, some are feeling left behind. Our government has a vision to make Ontario a better place to live, to work, and to raise a family. That is why we are building now, so that your children, your grandchildren, have the infrastructure, the schools, the healthcare, and communities they deserve. We know we can make it happen, without passing on the cost onto the hardworking backs of the people of Ontario.

In fact, we've already lowered costs. We've banned new road tolls on the 400-series highways, and we've permanently frozen driver's licences and photo card fees. We're saving around 66 million dollars over the next five years through those measures. And on top of that, our new One-Fare Program is eliminating double fares on transit, and saving riders an average of 1,600 dollars every year. Think about that. Over a hundred bucks more in the pockets of the hardworking people of the GTA.

We're also supporting more seniors who need financial assistance through our Guaranteed Annual Income System, or GAINS, which we have indexed to inflation for the very first time in Ontario's history, and expanded to help 100,000 more seniors. So, while the federal government plans to increase its Carbon Tax on April 1st, folks, we have chosen a different path, as we believe now is not the time to hike taxes—I heard one clap. [Applause] In fact, since our government has cut the Gas Tax in 2022, people in Ontario have saved over 2.1 billion dollars. One of the largest tax cuts this century in Ontario. And all this to say that growth is at the heart of our plan for building a better Ontario. Growth that ensures the people and employers of the province benefit from jobs, prosperity, and opportunity. Ontario has proven time and again that, together, we can overcome any obstacle in our way. And despite some challenges, Ontario remains resilient, and I'm confident in the vision of our future.

[Remarks in French] We will continue to keep costs down, build up, and invest in a better Ontario for the future, rebuild this economy—we're going to do it together. And I want to thank the Empire Club, and all of you here today, who play a role in rebuilding that economy. We can have those important discussions that turn these actions into results that will benefit all Ontarians. Thank you very much.

Sal Rabbani
Thank you, Minister. I'd now like to officially welcome The Honourable Lisa Raitt, Vice-Chair, Global Investment Banking, CIBC Capital Markets, to moderate this discussion with the Honourable Peter Bethlenfalvy. Lisa, welcome.

The Honourable Lisa Raitt, Vice-Chair, Global Investment Banking, CIBC Capital Markets
Thanks very much, Sal, appreciate it. So, Minister, I haven't lost the ability to gauge when a politician is wrapping up their speech. I had my book on the table and I'm listening to you intently, and then I felt you move into that final portion. I thought, "Oh, time for me to pack it up and get going." Now, we're amongst friends here today. A very friendly audience. And I know you have an announcement on Tuesday. But, you know, you can just tell us now, what's in the budget? It's all good, it's all good.

The Hon. Peter Bethlenfalvy
So, are you pissed off at me?

The Hon. Lisa Raitt
No—naughty word. No, I, I noted this morning that you had, I thought, a really strong announcement, when it came to taking a look at affordability in the province. Do you want to let us know a little bit about, around your plans in terms of housing affordability, housing stock, that kind of stuff?

The Hon. Peter Bethlenfalvy
Sure. And you know, not to pass your first question, you know—folks, you know, the, the economy is tougher in parts of the world. We know the UK and Japan are in recession, we're bouncing along the bottom. We're seeing slightly positive growth in Canada; the US is performing better than expected. But revenues are down, and the costs of things are up for everybody, you know—and that includes government. But you have two choices in that environment. You can either put on the brakes and slow down, or you can keep going. And I choose the latter 10 times out of 10.

You know, we've got to go through the cycles. If you slow down supporting people, if you slow down building the critical infrastructure that I talked about, you're just delaying. You're just going to have to play more catch-up. In fact—hopefully it's a friendly crowd, because I'm going to take a shot at the previous government, and I know some of them are here—you know, we didn't build enough infrastructure over the last 15 years. We just didn't. Schools, hospitals, roads, transit. So, we inherited that deficit. Lisa, we have the most ambitious 10-year capital plan in the history of the province.

The Hon. Lisa Raitt
M'hm (affirmative).

The Hon. Peter Bethlenfalvy
And what we announced this morning—I've crisscrossed the province. And what municipalities tell me over and over again, "Thank you for the Building Faster Fund, thank you for incentives for getting shovels in the ground, building the houses." Because, you know—and we'll probably get into it—there's a generation of young folks who are disillusioned, because they can't, they can't, they will not have the—they dream about owning a house, or a home, or a condo, or whatever. But they can't. We have newcomers who can't participate in that Ontario dream, that Canadian dream. So, what we announced this morning was one of the largest infrastructure spends for housing in our province's history. This was the number one ask by the Association of Municipalities of Ontario. This was the number one ask of the big city mayors, the number one ask of the Federation of Municipalities.

The Hon. Lisa Raitt
M'hm (affirmative)

The Hon. Peter Bethlenfalvy
Across Canada, we need that infrastructure, roads, bridges, water, wastewater, and we need help.

The Hon. Lisa Raitt
Yeah.

The Hon. Peter Bethlenfalvy
And so, what we announced today: 1.8 billion of additional help, to help get houses built faster, more of them, right across the province. So, that's what we're doing, and I'm so excited. Now, that will be in the budget. But I announced it today.

The Hon. Lisa Raitt
Okay, I'll take that, I'll take that. It's a good announcement. You just mentioned, Minister, I think, taking the temperature of what's going on in the country. I was a little bit struck by two things that I came across this week. One was a Nick Nanos poll that my other part-time job, the Coalition for a Better Future, commissioned, which asked Canadians a question about, "How do you feel about whether or not we are making sure that Canadians have a high standard of living?" And the way the demographics broke down was actually really concerning. If you're over 55, 47 percent of you think that we're going in the wrong direction. So, that's below 50 percent. That's not terrible for a government. But if you're between 18 and 34 years of age, 64 percent of you think that Canada is going in the wrong direction, when it comes to a high standard of living. How do you address something like that?

The Hon. Peter Bethlenfalvy
Well, I gotta tell you, I'm in that latter cohort, 18 to 34...

The Hon. Lisa Raitt
Me too, me too.

The Hon. Peter Bethlenfalvy
...but I feel positive about the province. Look, folks. You know, when we crisscross the province, when we talk to people day in, day out, the number one thing is the cost of living and affordability. You know, we may not be technically in a recession...

The Hon. Lisa Raitt
M'hm (affirmative)

The Hon. Peter Bethlenfalvy
...but they're feeling like they're in a very tough recession. You know, the price of gas, the price of food, your rent, your mortgage costs; you name it, everywhere you turn, it costs more. So, we have to recognize, and we recognized early, that that was the situation. We cut the Gas Tax in May of 2022. We acted early to address this. That's 2.1 billion back. And any of you who drove here or drive on the weekend—you know, most of Canada, you can't take a subway or a public transit. Think about that. You just cannot. So, you're on the backs of hardworking people, [indiscernible] the Carbon Tax is coming in—you know, you don't need a poll to tell you how frustrating it is, and how hard it is for so many people.

What I would say to them is that we've been working on, you know, building a greater Ontario, getting shovels in the ground. We didn't just start in this budget. We didn't start last budget. In fact, we started six years ago. And I can tell you that when we ran in 2022, we ran on the budget that, that we tabled, and it was a plan to build Ontario.

The Hon. Lisa Raitt
M'hm (affirmative)

The Hon. Peter Bethlenfalvy
And I would say this, Lisa. For those who are feeling we're going in the wrong direction, there's hope. There's hope, because we have a plan and a vision. And I mentioned Brian Mulroney. You know, these are tough, these aren't easy times. You know, Brian Mulroney, in 1988, the Free Trade Agreement was tough. Many people didn't support that. The next mandate, reforming the tax, taking the Manufacturing Tax down from 13-and-a-half and levelling it, so it'd make it a level playing field. Those are tough, tough decisions. But you got to rise up to the challenges, and not run from a poll like that. Lisa, we got to, I think we have a plan that we're executing. And it's not just highways and roads, which are absolutely critical. I mentioned, if you think we're in gridlock today...

The Hon. Lisa Raitt
Yeah.

The Hon. Peter Bethlenfalvy
...just wait a little bit; it's going to get worse. But we got to build hospitals, we got to build—I tell you, the Ring of Fire in the North...

The Hon. Lisa Raitt
Yeah.

The Hon. Peter Bethlenfalvy
...if you want to have an EV revolution, and you want to have security and safety supply, most of the mining is going on in China, processing in outside of North America. The number one producer of cobalt is the Congo.

The Hon. Lisa Raitt
M'hm (affirmative).

The Hon. Peter Bethlenfalvy
If you, if we want to have security supply, we've got to develop that Ring of Fire. There is no question. We have great partners in the First Nations, but we got to build the infrastructure to do that, to get those. And I'll put up our critical mineral mining—we got John McKenzie here from the TMX—you know, risk capital has to feel that there's certainty here. That it doesn't take 15 years to maybe on a permit, that we have the infrastructure, they don't have to helicopter in, that we have the workers, that we can innovate. And I'll tell you what, folks, we will mine more effectively, responsibly, reliably, ethically. I'll put us up against any country on the planet.

The Hon. Lisa Raitt
Agree.

The Hon. Peter Bethlenfalvy
And that will go to drive the electric vehicle revolution. And we talk about cars...

The Hon. Lisa Raitt
Yeah.

The Hon. Peter Bethlenfalvy
...but it's not just cars, Lisa, you know; it's trucks and other vehicles. And it goes a bit further, you know. This province, that I think is what we're doing is giving people hope. Think about what's happening in Sault Ste. Marie. Has anyone been to Sault Ste. Marie lately? Anybody here? Okay, one—Alyssa (ph), you're here, I know, from my staff; she's from Sault Ste. Marie.

The Hon. Lisa Raitt
Not on my bingo card of questions the minister was going to ask today. But okay.

The Hon. Peter Bethlenfalvy
Well, go up to Sault Ste. Marie, go visit the Algoma Steel construction of The Electric-Arc-Furnace. You won't believe what's happening. They're converting from a blast coal-fired plant that has to run 24/7—so, when the price of steel goes down, they got to keep producing steel. They're converting to electric, electricity. Green, clean steel being produced, that will allow them to produce more steel, to be able to have higher margin and profits, to be able to pay the hardworking workers, and have bigger, bigger paychecks, and better jobs, all the while reducing emissions.

The Hon. Lisa Raitt
M'hm (affirmative).

The Hon. Peter Bethlenfalvy
And that's in the private sector. We're helping them get that done.

The Hon. Lisa Raitt
M'hm (affirmative)

The Hon. Peter Bethlenfalvy
So, I think there's a lot of hope for that 18 to 34 generation, and for the 53 percent that we still got to tackle...

The Hon. Lisa Raitt
That's true.

The Hon. Peter Bethlenfalvy
...on the...

The Hon. Lisa Raitt
On the other side.

The Hon. Peter Bethlenfalvy
...on the, on my cohort.

The Hon. Lisa Raitt
Thank you, Minister. I appreciate that optimism. Now, I'm going to drive us right into pessimism again. If you notice, you're not the, you're not the first province to come out with their budget. There's been a number of budgets that have been introduced across the country; Québec, you've seen, Saskatchewan, you've seen, New Brunswick. A lot of these provinces are still showing up in deficit. What are your thoughts? Again, I'm trying to find out what's in the budget, I must say.

The Hon. Peter Bethlenfalvy
Very clever. I know you're a clever person.

The Hon. Lisa Raitt
I know.

The Hon. Peter Bethlenfalvy
Well, you won't be surprised that I won't tell you exactly what's happening. But, you know, writ large, you know. I mentioned that revenues, the economies are slowing down, costs are up, and you have choices. Do you keep building this infrastructure, and keep helping people in the, through these tough times? Or do you slow down? I'm choosing going forward. What I will tell you is that, you know, we, we are—I think you can walk and chew at the same time.

The Hon. Lisa Raitt
M'hm (affirmative)

The Hon. Peter Bethlenfalvy
I think you can invest in people, you know, skilled trades, construction workers; we've got the largest retraining program in, I think, Canada's history. We're increasing the amount of healthcare workers at a very rapid rate in this province. We're leading the country. Our front, first responders, you know, we're supporting them. We want to keep our community safe. But let me tell you this. Is Gadi Mayman here, from the Ontario Financing Authority? He's usually here, and I catch him on his cell phone—there he is. So, you sat in the back where I can't see you—you're on your cell phone. I know it, Gadi.

The Hon. Lisa Raitt
Ah.

The Hon. Peter Bethlenfalvy
He runs the Ontario Financing Authority. He's been at it for a while. And it's the credit to his team that we now have the lowest interest cost to revenue since the 1980's. So, put that in perspective. In Ontario, 6.7 cents on the dollar goes to bondholders. That means we have almost 93.3 cents to fund the infrastructure programs.

The Hon. Lisa Raitt
M'hm (affirmative).

The Hon. Peter Bethlenfalvy
Take a look down the road in Ottawa, and see how much they're spending on interest expense. And you would remember, Lisa, in the 1990's, that interest cost, 30 cents on the taxpayer dollar was going to bondholders.

The Hon. Lisa Raitt
Yeah.

The Hon. Peter Bethlenfalvy
So, we've got our eye on the fiscal plan. We've got an eye—our debt-to-GDP is under 40 percent. We've got that under wraps. But, you know, we're not going to slow down investing in Ontarians, and in the people, and the infrastructure in this province.

The Hon. Lisa Raitt
Excellent. I saw you on TV—you said you heard me on the radio this morning; I saw you on TV, I think on Tuesday—and you were talking about the Carbon Tax, and the fact that the premier has written to the prime minister, and that other provinces have actually come forward and said, you know, April 1 is looming, and it's not looking too good, affordability-wise. What are your thoughts, just to give you the broad question to tee off on it?

The Hon. Peter Bethlenfalvy
Oh boy, how much time do we have?

The Hon. Lisa Raitt
I don't know, that's a good question.

The Hon. Peter Bethlenfalvy
Look, everywhere I go, I talk about affordability, the cost of things being hard. You know, don't underestimate how tough that is on people.

The Hon. Lisa Raitt
Yeah.

The Hon. Peter Bethlenfalvy
And when they hear that someone's raising a tax—you know, we're very proud that we've grown our revenues by over 50 billion dollars, since we came into power. You know, about 150 when we came in; over 200 billion now, in five, five-and-a-half years. You know, there's a different path to balancing books. There's a different path to helping people in businesses, without raising taxes. It's because we have a vision and a plan. And so, we have a government that insists on making it tough on people, on consumers. I tell you, when you fill up at that gas tank, it's tough. Now, we see a coalition building right across the country. We've got Liberal premiers, Opposition Liberal in New Brunswick...

The Hon. Lisa Raitt
M'hm (affirmative).

The Hon. Peter Bethlenfalvy
...Bonnie Crombie hasn't exactly said she's against Trudeau's Carbon Tax. We've got Wab Kinew cutting Gas Tax in Manitoba. We've got premiers right across the province supporting not putting more burden on the backs of people. You know, you gotta listen to the people. And that's why we were moved early...

The Hon. Lisa Raitt
M'hm (affirmative).

The Hon. Peter Bethlenfalvy
...on the Gas Tax. But I said another thing in that answer is that there are different paths to net-zero. We all agree on climate change. We gotta do it. And I got to tell you, Ontario is leading the way. And the way you're doing it, you got Bruce Power here, you know, you've got a nuclear station in my riding, Pickering. I think the mayor of Pickering is here, five-time mayor—there he is, Dave Ryan—who built Pickering, put the foundation of that great city. We're refurbishing the Pickering Nuclear. What do I mean by that? That's green, clean energy. We're leading. So, there's a path through nuclear, hydro, and renewables. I mentioned the coal coming out, not just in Sault Ste. Marie with Algoma, but also Dofasco in Hamilton that you, whenever you drive there, you see it. We're converting that to an electric furnace, which will be powered by that green clean nuclear energy, and hydro, and renewables.

But we're also investing in this electric vehicle revolution, so that in 10 years, or whatever time frame everyone's going to have a car that doesn't emit, or a truck that doesn't emit. So, Ontario is leading the country, I think, in this—and the world—in driving to a clean electricity footprint...

The Hon. Lisa Raitt
Yep.

The Hon. Peter Bethlenfalvy
...and beyond. So, I think, now—when you do a Carbon Tax, are you changing behaviours? Most of Canada, you can't, you know, take a subway to your hockey practice, you know, you can't take it to your job. This is the nature of Canada. Is it changing the emissions? There's no evidence that it's changing the emissions. And not only that, the public, the Parliamentary Budget Officer is saying, when you add in economic costs, you're further behind. So, how does that make sense? So, in Ontario, we've cut the Gas Tax, we saved 2.1 billion, we've done a lot of other things that I mentioned in my marks, and we're just going to keep going.

The Hon. Lisa Raitt
I think that's proper. You mentioned a couple of things, EVs, critical minerals, steel from Sault Ste. Marie. All of those things, though, have to be exported somewhere; probably going to be exported to the United States. How are you feeling about the situation, with respect to the US election coming, and how we're going to be prepared in Ontario for, if there is a change? Cause the last time wasn't so great. That was not on the list of approved questions, ladies and gentlemen. But I know the minister.

The Hon. Peter Bethlenfalvy
You know, I worked at Dominion Bond Rating Service, the credit rating agency...

The Hon. Lisa Raitt
Yeah.

The Hon. Peter Bethlenfalvy
...and one of the principles that you learn there is you rate, and do the credit rating through the cycle.

The Hon. Lisa Raitt
Yeah.

The Hon. Peter Bethlenfalvy
And I think one of the things, like what, why I'm so passionate about infrastructure not slowing down—economies go down and they go up. And where you get into trouble is, if you slow down, if you don't keep investing. And in fact, in infrastructure, it's a counter-cyclical measure to a downturn; as the private sector contracts, the public sector can come in and absorb that labour. And, you know, you don't want to get—so that's one thing you do. And the benefit of that? Election cycles.

The Hon. Lisa Raitt
Yeah.

The Hon. Peter Bethlenfalvy
You know, they go up and they go down. And my philosophy is work, focus on the things that you, are right here in front of you that you can impact. Whatever happens, happens, that's democracy...

The Hon. Lisa Raitt
Yep.

The Hon. Peter Bethlenfalvy
...right? But we'll, we'll work with whoever. It's just like in Ottawa, we'll work with whoever. And my philosophy is: we've got our interests, maybe the different party has their interests, but there's always an intersection...

The Hon. Lisa Raitt
M'hm (affirmative).

The Hon. Peter Bethlenfalvy
...where you can work together.

The Hon. Lisa Raitt
M'hm (affirmative).

The Hon. Peter Bethlenfalvy
And that's the philosophy of Doug Ford, our premier, who has that, in my opinion, that Brian Mulroney vision...

The Hon. Lisa Raitt
M'hm (affirmative).

The Hon. Peter Bethlenfalvy
...of building a greater economy not just for the next 2 years, 4 years, 10 years. But for a generation and beyond.

The Hon. Lisa Raitt
Yeah.

The Hon. Peter Bethlenfalvy
So that's how I think about it.

The Hon. Lisa Raitt
Fair enough. Before I go to questions from the floor—and I have them right here—can you give us an update on the Ontario Infrastructure Bank, and where we are?

The Hon. Peter Bethlenfalvy
Yeah, so, so I just think we got so much infrastructure to build, I'm always looking for new ways to get things built faster...

The Hon. Lisa Raitt
M'hm (affirmative).

The Hon. Peter Bethlenfalvy
...do more of it. And so, this Infrastructure Bank—which, by the way, we're going to rename in the budget, so there's one thing, so.

The Hon. Lisa Raitt
Hey, scoop!

The Hon. Peter Bethlenfalvy
Yeah. So, so stay tuned for that. You know, what I can tell you about that is, you know, we gotta look at different ways to build more.

The Hon. Lisa Raitt
M'hm (affirmative).

The Hon. Peter Bethlenfalvy
And we focused on areas like energy. You know, our energy footprint, and the investment that we're making in all these things is massive. If I think about housing—just student housing, for example, it takes us 10 years to get a shovel in the ground for student housing—it's another avenue potentially we can use the Infrastructure Bank for. If I think about municipal infrastructure, we made that announcement this morning. I think there's lots of opportunity there. And, you know, again, it's not ideology, it's math. We have an aging population—and you can relate to this.

The Hon. Lisa Raitt
I know that. I know this.

The Hon. Peter Bethlenfalvy
We have, you know, not everyone can be...

The Hon. Lisa Raitt
Yep.

The Hon. Peter Bethlenfalvy
...at home.

The Hon. Lisa Raitt
Yeah.

The Hon. Peter Bethlenfalvy
We've got to build those long-term care facilities.

The Hon. Lisa Raitt
Yeah.

The Hon. Peter Bethlenfalvy
We've got to have world-class facilities. Because folks, seniors built this province. And I feel strongly we got to reinvest to take care of them.

QUESTION & ANSWER

The Hon. Lisa Raitt
Just for the audience, when you turned to me and said, "You know, we have an aging problem, and you looked at me and you said: you know, this, Lisa," I want to let everyone know, I knew where he was going on this topic of long-term care. It's, it's okay. It wasn't a complete diss. Minister, the question from the floor: "Given the rapid evolution and the potential of AI to solve complex problems, can you comment on your government's plan to leverage AI, to drive towards more efficient decision-making and planning?"

The Hon. Peter Bethlenfalvy
Well, I love Dan's comments, from Amazon. And we've got to attract capital from around the world. And we're investing in technology. We want to give people the tools to do their jobs. And, you know, it used to be that we'd be worried, will productivity and technology would replace the worker?

The Hon. Lisa Raitt
M'hm (affirmative)

The Hon. Peter Bethlenfalvy
We don't have enough workers.

The Hon. Lisa Raitt
M'hm (affirmative).

The Hon. Peter Bethlenfalvy
That's part of the demographic situation we have. So, we have to invest in our workers. And that's why we're working with unions, and workers right across the province, to collaboratively work on the tools. You know, Dan mentioned robotics. I go everywhere. It's phenomenal what's happening here in Ontario. And in fact, the premier often talks about how we're Silicon Valley North, you know. We have the ingredients here, the talent, the research facilities here. So, I think, you know, whether it's the private sector and, and the business community, or even, like, health. We've got so much data. How we can, you know, use technology to free up time to, to do things better. And if you think about what the Ontario Medical Association said, you know, like how much, 20 percent of their week is filling out paperwork.

The Hon. Lisa Raitt
M'hm (affirmative).

The Hon. Peter Bethlenfalvy
I've been trying to kill the fax for six years. Six years. I came up with a slogan, I thought it was so clever, "Axe the Fax." You know, "Axe the Tax"?

The Hon. Lisa Raitt
Yeah.

The Hon. Peter Bethlenfalvy
I know where he got it. I know where he got it. "Axe the Fax." And, you know, six years later, I haven't killed all the fax machines. It's, they're like vampires, you know? You can't kill 'em. You know, if we're just faxing things in 2024, and patients' records, and information—folks, we've got to embrace the talent that we have, the infrastructure we have, that we can give the tools, so we can all do our jobs better...

The Hon. Lisa Raitt
Yeah.

The Hon. Peter Bethlenfalvy
...and have the quality of life? I'm all in.

The Hon. Lisa Raitt
Awesome. I think this is my last question, because we're running a little bit short on time. But I, from the audience, again, they say that the world seems to be more dominated by larger businesses—and this isn't against Amazon, by the way—the same is happening in Canada and Ontario. But how do you feel about the state of competitiveness? Are big companies too big?

The Hon. Peter Bethlenfalvy
No, no. And you want to encourage companies to get big, and compete. And I think we always need more competition.

The Hon. Lisa Raitt
Yeah.

The Hon. Peter Bethlenfalvy
You know, we need more competition. And by the way, that person was from the Competition Bureau. Just saying. But look, look at—I'll just use one example, Lisa. You know, I came here from Québec in the mid-'80's. And, by the way, I volunteered for Roy McMurty in 1985 for his leadership, because I, I didn't know anyone from Toronto. And I, I went to my fraternity, and I said, who should I support? And they said, "Brother McMurty." So, I supported and volunteered for Roy McMurty. And he recently passed away— another great Canadian, a great Ontarian. Yeah. And when I came here from Québec, and I went to—as a Québécois does—I went to the depanneur, and I said, "Give me a six-pack of Molson Export," and they looked like I had horns coming out of my head. And I said, you know, okay, well, I'll go down to the, the Metro, and the Loblaws, and they didn't have a six-pack of Molson. So, long way to say, we announced in December that we're overhauling the alcohol framework in Ontario that's been in place since 1927, so that you can have more convenience, and choice, and competition. This is going to be a boon for small business, our convenience stores, our small grocers, distribution. And it's going to help all of you have more convenience, choice, and competition. We ran on it in 2018, we ran on it again in '22, and it's this minister in this government that's going to get it done.

The Hon. Lisa Raitt
Excellent. Thank you very much. Thank you, everybody, for your questions and your attention today. Heck of an audience. When they told me that there would be 600 people here, I did not expect that to actually happen. Congratulations to the Empire Club of Canada. And Minister, as, you know, they all came here to see you today. Thank you very much for being here.

The Hon. Peter Bethlenfalvy
Thank you, everyone. Thank you, Lisa.

Sal Rabbani
Thank you. Thank you, Lisa Raitt, and Minister Bethlenfalvy. I'd now like to welcome on the stage Andrew Spencer, the EVP Capital Portfolio Delivery for Hydro One, for the appreciation remarks.

Note of Appreciation by Andrew Spencer, EVP Capital Portfolio Delivery, Hydro One
Well, thank you both for your entertainment. It was inspiring, and a pleasure to be here this afternoon. So, my name is Andrew Spencer. I'm the Executive Vice President of Capital Portfolio Delivery, accountable for building a lot of this critical infrastructure we heard about today. So, on behalf of Hydro One and the Empire Club, thank you everyone here, Minister, for taking time to speak with us today.

Over the past year, we've seen this government act to build the critical infrastructure Ontario needs, address affordability in times of economic uncertainty, and set a strong fiscal foundation for future generations. We look forward to seeing how this year's budget builds on those actions. The energy sector has been pleased to see the province's leadership through the Powering Ontario's Growth Plan, which supports new investments in the electricity system, including new transmission, generation, and storage. The electricity industry is undergoing a profound transformation. Changing technologies are shaping how and where our customers use electricity. As a province, we're well positioned to enable this shift, with a grid that's already 92 percent clean. It will allow us to keep momentum, and continue to attract new investments, like the electric vehicle manufacturing in the Southwest, clean steelmaking in Algoma, and critical mineral opportunities in the North. It will ensure power is there when it's needed, to energize life, to support Ontario's commitment to building one-and-a-half million new homes. This government has demonstrated a commitment to Ontarians, and Ontario businesses, by continuing to cut red tape, by modernizing, streamlining, and enhancing the environmental assessment processes. For companies like Hydro One, who build and operate infrastructure, that change reduces regulatory uncertainty, cuts the cost of building infrastructure, and allows us to get shovels in the ground with our partners sooner, while maintaining our ability to build projects in an environmentally responsible manner. We see further opportunities working in collaboration with government to drive efficiency and enrich customer experiences.

In November, Hydro One announced that the Chatham to Lakeshore Transmission Line in Southwestern Ontario is on track to be completed a full year early, and under budget. This line will add approximately 400 megawatts of clean electricity to the Southwest Region, which is enough to power a city the size of Windsor. Built in partnership with our First Nations, through Hydro One's industry-leading First Nation Equity model, the Chatham to Lakeshore Transmission Line will support—[Applause] that's worth a clap. Yeah. We're very proud of the model. It's a first within Canada, and we hope many will follow.

These transmission lines will support economic growth in the agrifoods, clean energy supply chain, and manufacturing sectors. In addition to the work the government is doing, Hydro One is doing our part to keep Ontario an affordable place to live, raise a family, work, or start a business. This is an exciting time, with many incredible growth opportunities ahead of us across the province. Once again, thank you, Minister, for your remarks, and thank you to the Empire Club for today's event.

Concluding Remarks by Sal Rabbani
Thank you, Andrew. And thanks to all our sponsors for their support, and everyone joining us today, in person or online. As a club of record, all Empire Club of Canada events are available to watch and listen to on demand on our website. The recording of this event will be available shortly, and everyone registered will receive an email with the link. Thank you all for your participation and support. Have a good afternoon. This meeting is now adjourned.