Canada’s Budget 2017: A closer look at what matters for a green economy

infrastructure from Budget 2017Canada’s federal budget statement, titled Skills, Innovation and Middle Class Jobs, was released on March 22, with a stated  commitment to the Pan-Canadian Framework on Clean Growth and Climate Change, and support for already-announced climate initiatives .  Some specific allocations: $11.4 million over four years for a national coal phase-out, beginning in 2018; $17.2 million over five years for a national clean fuels standard, starting in 2017;  $5 billion to green infrastructure and an additional $5 billion for public transit infrastructure over 11 years.  Disappointingly, the Budget extends the Mineral Exploration Tax Credit for another year, thus failing to end fossil fuel subsidies.

Reflecting their own particular interests, most unions issued immediate reactions:  see the Canadian Labour Congress ; Canadian Union of Public Employees ; United SteelworkersUnifor . In the Toronto Star, Paul Wells called the Budget “a list of decisions to be made later”, and most commentators remarked on the many deferred deadlines.  A March 22 blog by Hadrian Mertins-Kirkwood of the CCPA provides a thorough summary of the provisions relating to climate change policy,  noting that the phrase “climate change” is used 50 times, but  “when it comes to putting Canada on a pathway to deep decarbonization, Budget 2017 comes up short. Significant investments in key areas, such as public transit and clean technology, should not be dismissed out of hand, but the funds are heavily backloaded and too small given the scale and urgency of the climate challenge.”  Mertins-Kirkwood also notes that there are no direct measures to support Just Transition programs, although provisions to improve skills training , workforce development, and small changes to the Employment Insurance program may indirectly contribute to that goal.

Two thoughtful  analyses of the Budget have since been released: on March 24, the Canadian Labour Congress released its Detailed Analysis of Budget 2017, providing an overall assessment, but including a substantial consideration of provisions relating to a green economy.  CLC Highlights: “The Canada Infrastructure Bank will be resourced with $2.8 billion over five years; legislation creating the Bank is anticipated in spring 2017. In the weeks and months following the budget, the Government of Canada will work on a framework to apply a green lens and an employment-based community benefit lens to infrastructure projects, which may become part of the bilateral infrastructure agreements.”  Regarding “Transition to a Green Economy”:  “In Budget 2017, investments in 2017-18 and 2018-19 under the $2 billion Low-Carbon Economy Fund …are scaled back and re-allocated for future years. Budget 2017 offers $2 billion for a Disaster Mitigation and Adaptation Fund, administered through Infrastructure Canada. The budget allocates $220 million to reduce the reliance of rural and remote communities on diesel fuel, and to support the use of more sustainable, renewable power solutions. An array of investments are made in order to support the development of the clean tech industry in Canada. In 2016, Canada joined other G-20 countries in re-committing to phase out fossil-fuel subsidies by 2025. The budget contains two modest proposals to scale back fossil fuel subsidies, but no specific concrete commitments are made to comply with the 2025 deadline.  Budget 2017 provides funds to accelerate the coal phase-out in Alberta, but it is unclear whether there will be funding to deal with the impacts on workers and communities. There is no explicit mention in Budget 2017 of just transition measures, or the government’s proposed just transition task force.”

On  March 27, the Pembina Institute released  Budget 2017: Ready, set implement  which offers its reaction and further suggestions on three issues.  Acknowledging the scale of investment and the importance of consultation, particularly with First Nations, Pembina declares, ” in our view, it’s not unreasonable that the $2 billion Low Carbon Economy Fund has been altered to extend over five years.”   Regarding “Next steps on the National Carbon Price”, Pembina applauds the details provided re the  national carbon price backstop — “set to begin at $10 per tonne of carbon pollution in 2018, and to escalate by $10 per year until 2022.”  Pembina also highlights the announcement of a federal government consultation paper with technical details of the national carbon price, promised in 2017. It urges that the national carbon benchmark price be linked to inflation, be subject to a review in 2020, and that the government design a fair and transparent framework for that review well in advance.

Finally, in “Accelerating decarbonization of goods movement”, Pembina notes the Budget’s commitments to new clean fuel standards and heavy-duty truck retrofit regulations, as well as the allocation of $2 billion over 11 years in a new National Trade Corridors Fund to address congestion and inefficiencies in rail and highway corridors, especially  around the Greater Toronto Area . They re-state their proposal for  North America’s first low-carbon highway between Windsor and Quebec City, based on  building out an “alternative fuelling infrastructure — like electric vehicle fast-charging, compressed natural gas or hydrogen stations — for personal and commercial transportation along the route.”

 

 

 

 

 

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