Federal budget not enough to help Calgary’s economic recovery: Nenshi

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The first federal budget in more than two years aims to pull Canada through the pandemic, but doesn’t go far enough to help Calgary’s post-COVID recovery, Mayor Naheed Nenshi said Monday.

More than $100 billion in new spending was announced in the 2021 budget for programs such as national daycare and lifelines for struggling workers and businesses.

But speaking after the budget was tabled, the mayor said several specific requests from the city weren’t fulfilled, especially as Calgary starts on a harder road to recovery than other cities.

Finance Minister Chrystia Freeland said the budget “is about finishing the fight against COVID” and “healing the economic wounds” in its wake.

But Nenshi said Calgary needs more specific investment to deal with the way Alberta’s economy has been uniquely battered.

“In some places, we anticipate that there will be enormous pent-up market demand, and the economy will boom very quickly,” he said.

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“But in other places like Calgary, where the fundamentals were not as strong, we are concerned that the post-pandemic recovery will be a bit slower.”

Nenshi said the budget includes some steps forward for investment in Calgary’s downtown and affordable housing, but he wanted to see additional recognition of Calgary’s more difficult situation compared to other major cities.

Alberta’s Minister of Finance Travis Toews also expressed concerns about details of the budget, “specifically the exclusion of enhanced oil recovery projects with a net-zero carbon profile.”

“The budget is light on increasing investment and productivity, increasing market access opportunities for Alberta and growing the economy,” said Toews in a statement.

“In particular, we are gravely disappointed that the federal government once again missed an opportunity to fix the fiscal unfairness of the federation by acting on the unanimous request of provinces to retroactively lift the cap on the fiscal stabilization program.”

He said the provincial government will be working to ensure the best interests of Albertans are respected.

Freeland’s budget plan focuses on helping some of those hit hardest in the last year — sectors such as tourism, as well as low-wage workers, small and medium-sized businesses, women and young people.

The plan seeks to invest $500 million in a tourism relief fund to support local tourism businesses adapting and recovering from COVID-19, and $300 million over two years to establish a recovery fund for the heritage, arts, culture and sports sectors.

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Freeland — who made history as Canada’s first female finance minister to table a federal budget — acknowledged the weight the pandemic continues to bear on Canadians.

“We are all tired, and frustrated, and even afraid,” she said. “But we will get through this.”

The government will need to get at least one opposition party to support it to avoid a pandemic election this spring.

Canada’s net debt is now over $1 trillion for the first time ever, after a $354-billion deficit for the pandemic year just over. It is expected to keep climbing with deficits of $155 billion this year, and $60 billion in 2022-23.

That is driven in part by more than $100 billion in new spending over the next three years, including costs to maintain federal wage and rent subsidies and aid for laid-off workers, until September.

Murray Sigler, the interim CEO of the Calgary Chamber of Commerce, said the chamber is grateful the federal government listened to some of its recommendations. However, he said they’ll be watching closely to ensure Calgary gets its fair share of the money.

“And its fair share has to be a large share because of all the metropolitan areas in this country, Calgary is the hardest hit. It was the hardest hit before COVID, it’s the hardest hit during COVID and it’s going to be the hardest hit after COVID,” said Sigler.

“We need to build our downtown and get a piece of all those infrastructure investments.”

He’s pleased there’s a commitment to getting Canada out of the crisis, especially in its decision to extend relief programs for workers and employers.

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Adam Legge, president of the Business Council of Alberta, said in a statement that the budget addresses two key investments — a “robust” national child-care system and improvements to the innovation agenda — however, the council is overall disappointed.

“It has a significant price tag but comes up woefully short on the ambition and approach necessary for Canada to become an economic and climate leader coming out of the COVID pandemic,” said Legge.

Specifically, he said the budget under-invests in areas that could drive emissions down and competitiveness up, such as carbon capture, and it doesn’t provide a sufficient long-term growth agenda for jobs.

Calgary MP Michelle Rempel Garner said she had been expecting more support for Alberta, as the province continues to grapple with some of the highest unemployment rates in the country.

She was looking for a clearer plan for addressing the unsustainable deficit spending levels, and was hopeful the budget would include benchmarks for a plan to move towards safe, permanent lifting of COVID-19 restrictions.

“I think a lot of businesses are not thinking about hiring right now. They’re thinking about survival and without a clear line of sight on reopening and what benchmarks are used for that, it’s a tough call for businesses to make,” Rempel Garner said.

“Our province had a lot of economic needs prior to the pandemic and those certainly were made worse . . . last year. I was expecting something that spoke to some of the structural challenges we’ve been facing.”

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One of the biggest promises in Freeland’s budget is billions in new spending for provinces to create spaces and drive down fees for child care, including a drop in fees by 50 per cent by next year and $10-a-day spaces across the country, outside of Quebec which has its own system, by 2026.

Jennifer Usher, spokeswoman for the Association of Early Childhood Educators of Alberta, said this will fill a gap in affordable child care for low- to middle-income families.

“This will allow families to get back to work and not have to worry about really high fees that they have to pay. It’ll impact women, in particular, because we know they have been disproportionately impacted by the pandemic, having to leave their jobs to care for children,” said Usher.

Early education and child care has been heavily hit during the pandemic, with many families keeping their kids at home and spaces adapting to provincial restrictions. Usher said this kind of federal funding will stabilize the sector and get early educators back to work.

In what is the first budget in more than two years, Freeland topped up the Liberals’ 10-year, $40-billion housing strategy with an additional $2.5-billion commitment.

Some 60 per cent of that will go toward the construction of 4,500 new units under the so-called Rapid Housing Initiative, which seeks to provide vulnerable Canadians with affordable homes.

The budget’s plan to build or repair 35,000 units in total — with the help of a reallocated $1.3 billion in existing funding — makes only a small dent in the more than 1.6 million Canadians who “live in core housing need,” the budget states.

Nenshi said while it’s a big commitment, it’s less than he had anticipated for affordable housing. He’s been hoping for a major cash injection from the feds that, along with funding from the province, could end chronic homelessness in Calgary.

“This will get us down that road; I’m not sure it will get us all the way there,” he said.

— With files from Madeline Smith and The Canadian Press

sbabych@postmedia.com
Twitter: @BabychStephanie