No clean economy vision is evident in the pre-election budget , Investing in the Middle Class, delivered by Canada’s Finance Minister on March 19. The National Observer has a Special Report on Budget 2019 , composed of twelve focused articles covering the range of notable provisions. Mitchell Beer provides a good summary of the Budget’s climate-related provisions, in “Morneau’s Pre-Election Budget Boosts ZEVs and Energy Retrofits, Extends New Fossil Subsidy” in the Energy Mix (March 20). Elizabeth May, leader of the Green Party is quoted in that article, and says that the climate provisions are “pathetic” – a similar reaction to that of Environmental Defence,which states more diplomatically that “funding for climate change in this budget does not match the scale of the challenge”. Similarly, the Canadian Centre for Policy Alternatives reaction judges the climate provisions as “modest efforts to move forward on greening the economy”, although calls the just transition plan “an important precedent.” The Canadian Labour Congress reaction is a lengthly commentary on many worker-related initiatives – including the issue of Just Transition.
On the issue of Just Transition: The Budget plan text on Just Transition reiterates the previous Budget’s pledge of $35 million over five years for Just Transition of coal workers. In its reaction, the Canadian Labour Congress acknowledges the new pledge of $150 million in infrastructure funding to directly assist resource-based municipalities, but quotes Hassan Yussuff, Co-Chair of Canada’s Task Force on Just Transition: “… Canada’s unions are looking forward to working with the Minister of Natural Resources as the newly named lead minister, but are disappointed to see that the government has not addressed key Task Force recommendations to support workers, in terms of income, training and reemployment needs. Without this, workers will be left behind.”
More details appear in “Coal workers get cash in budget but lack of details risks ‘major blowback” in the National Observer (March 19), including that the $150 million infrastructure funding will not flow until the 2020-2021 fiscal year. Funds will be delivered by Western Economic Diversification Canada at a rate of $21 million a year over 4 years, and the Atlantic Canada Opportunities Agency , at a rate of $9 million a year for 4 year.
On the issue of fossil fuel subsidies: The government reaffirmed its long-standing (and unfulfilled) commitments to phase out fossil fuel subsidies , and pledged to establish an expert committee to examine the issue. Here is the reaction from the Stop Funding Fossils Initiative: “This year marks the tenth anniversary of Canada’s G20 commitment to phase out fossil fuel subsidies. Yet, despite moderate progress in the 2017 budget, Canada remains the largest provider of fiscal support to oil and gas production in the G7 relative to the size of its economy…. the Government of Canada has doubled down on fossil fuels by introducing billions of dollars in new subsidies in the past year. Budget 2019 allocates a further $100 million over four years to the Strategic Innovation Fund, aiming to help the oil and gas industry reduce emissions. ”
(Coincidentally, the 2019 Annual Fossil Fuel Report Card was released on March 20, revealing that global banks have invested nearly US$2 trillion in fossil projects since the Paris Agreement was signed, and Canada’s Bank of Montreal, RBC, ScotiaBank and CIBC are amongst the worst offenders. )
On the issue of electric vehicles: Budget 2019 included a number of policies aimed at speeding up EV adoption, including a 2040 deadline to phase out new internal combustion vehicle sales, and consumer rebates for purchases of electric and hybrid vehicles ($5000 for purchases under $45K). Despite recent reports that EV supply is restricting purchases, the government did not institute a mandatory sales mandate for car manufacturers. Businesses will be allowed to deduct the full value of a new ZEVehicle worth up to $55,000 in the year they purchase it. The government also pledged $130 million over the next five years to build electric vehicle charging stations – specifically including workplaces in the named locations. The National Observer summarizes these proposals in “Canada proposes rebates for electric cars, voluntary sales mandate”.
On the issue of infrastructure and the built environment: The text of the government’s announcement relating to energy efficiency is here , and a Backgrounder: Strong Communities, Affordable Electricity and a Clean Economy is also relevant. Initiatives include $1.01 billion in funding, immediately, to increase energy efficiency in residential, commercial and multi-unit buildings – in the form of financing and grants to retrofit community buildings, financing for municipal initiatives to support home retrofits, and financing to improve energy efficiency and support on-site energy generation in affordable housing developments . Funds will be administered through the Green Municipal Fund of the Federation of Canadian Municipalities. Macleans magazine summarizes this, as well as infrastructure funding, in “Cities are billion-dollar winners in Budget 2019” which states that “the biggest single new spending item in the budget is a $2.2 billion “one-time transfer” through the federal Gas Tax Fund. That money doubles the usual federal-municipal transfer through that mechanism. The windfall is intended to address “serious infrastructure deficits” in municipalities and First Nations communities.”