July 24, 2008

Ontario, Ottawa to spend billions on infrastructure

Globe and Mail

The federal government announced Thursday that it has inked a deal with Ontario to spend $9.3-billion over seven years in the province on public transit, roads and bridges as part of its plan to maintain and expand the country's infrastructure systems.

The Ontario government has signed on to Ottawa's infrastructure plan, called Building Canada, which will see the Harper government spend $33-billion over seven years on projects across the country.

“That is a historic commitment,” Lawrence Cannon, Federal Minister of Transport, Infrastructure and Communities, said at a news conference in London, Ont. “Substantial infrastructure funding was long overdue in this country.”

Mr. Cannon said Ontario will receive $6.2-billion from the federal government, including $3.1-billion from the Building Canada fund itself, to help the province repair its aging roads, bridges and other infrastructure. The Ontario government will match the Building Canada funding, raising the total investment to about $9.3-billion.

Ontario's share of the overall federal infrastructure pie will total $7.8-billion, including $4.4-billion from the gas tax. The funding arrangement will run until 2014.

Initial priorities include improvements to the Trans-Canada Highway in northwestern Ontario, rural broadband coverage in southern and eastern Ontario and rapid transit in the Kitchener-Waterloo Region.

Ontario is the latest province to reach a so-called framework agreement with Ottawa, which will set out how it will use its share of the funding.

British Columbia was the first province to reach an accord last November. Only three provinces – Alberta, Manitoba and Quebec – have yet to sign deals.

“This deal has been a long time coming, and it further represents a product of long and detailed discussions with our federal counterparts,” said George Smitherman, Ontario Minister of Public Infrastructure Renewal and Energy. “Today, we are celebrating the coming together of two levels of government to produce results for the people of Ontario.”

Mr. Smitherman was also on hand at the news conference, along with Federal Finance Minister Jim Flaherty and his provincial counterpart, Finance Minister Dwight Duncan.

It was the first time Mr. Flaherty has shared the stage with Mr. Duncan since the federal minister began waging a highly public fight with the McGuinty government earlier this year over its management of the Ontario economy.

Mr. Smitherman announced that the province will use $50-million of the federal funding to build a new reservoir and pumping station in London that will provide surrounding communities with a stable supply of clean drinking water. The province is kicking in $50-million for the project.

However, Mr. Smitherman said it will take a little while longer for the province to sign a framework agreement with the federal government for the multimillion-dollar plan to extend the Spadina subway line into the Toronto area's rapidly growing York Region. Ottawa's $697-million contribution to the long-awaited subway extension will come from the Building Canada fund.

Progressive Conservative Leader John Tory applauded his federal cousins today for helping Ontario improve its infrastructure. But he criticized Liberal Premier Dalton McGuinty for taking so long, compared with many other provinces, to reach a deal with the federal government that will allow the province to get access to the funding and get the projects under way.

“I would rather see Mr. McGuinty spending his time and his energy getting an agreement like that as opposed to launching broadsides at the federal government,” he said. “So far, he seems more interested in the broadsides.”

With a file by The Canadian Press


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