NOACC Submission to Standing Committee on Finance & Economic Affairs Pre-budget Consultation

The Northwestern Ontario Associated Chambers of Commerce (NOACC) is the “voice of business” representing the interests of nearly 2,000 members from Kenora and Rainy River in the West to Marathon and Greenstone in the East. We appreciate this opportunity to outline our concerns on a number of topics.

Skills Gap

The Province needs to address the skills gap. Two major trends are creating skills shortages. The first is the aging of the population and the departure of baby boomers from the workforce. The Conference Board of Canada’s long-term economic outlook projects that by 2025, one in five Canadians will be 65 or older. The second trend is that jobs are becoming increasingly specialized, which in turn demands more educated and skilled workers. The evidence is clear that the rising shortfall of skilled workers and the growing mismatch between the skills required and those available has evolved into a skills crisis affecting both the Ontario and the Canadian economy. Funding is vitally important to address the training and skills needs of Ontarians in all sectors.

One area that needs further attention is the apprenticeship system – the Ontario system uncompetitive with other resource-based Provinces. Many skilled trades require 4 journeypersons to train 2 apprentices, which leaves both small companies and rural communities at a disadvantage and does little to address the growing shortage of skilled trades. We believe that the current ratios are too high and should instead be comparative to Alberta and Saskatchewan levels of 1 journeyman to 3 apprentices.

We also remind the Province of the urgent need to engage Aboriginal communities in skills training programs and opportunities to ensure they can take full advantage of the benefits of economic growth. There is much work to be done to provide the training and skills that will enable the engagement of Aboriginal peoples in our growing economy.

Mining

Despite the challenges in the mining sector, we are confident that our region presentsan exceptional opportunity for significant fiscal growth for the entire province. Northwestern Ontario is home to hundreds of active mining projects including six (6) new projects in either construction or production phase by 2017 with mineral values in the Billions of dollars.

We encourage the Province to continue to move forward in the development of the Ring of Fire, which has been valued at nearly $85 Billion. This development is vital to the Ontario economy and we must ensure that the anticipated jobs, taxes and other economic benefits are not lost.

We are pleased that the Government of Ontario and Matawa First Nations have come to agreement on a regional framework for negotiations relating to development of the Ring of Fire. While we understand that there is much work to do, we believe it is important that those negotiations do not restrict progress on the environmental approval process for projects in the area.

Investors are looking for an indication of forward action on the Noront Eagle’s Nest project and will not wait indefinitely for a return on investment. We are concerned that on-going delays could result in reduced investor confidence and withdrawal of equity, which would require Noront to make difficult choices about their continued involvement in the Ring of Fire and the potential loss of a generation of opportunity for the First Nations communities in the area.

We believe that it is possible for Government to Government negotiations and the Environmental Assessment process to continue simultaneously. We encourage the Government to approve the Terms of Reference for Noront’s Environmental Assessment contingent on an agreement that Noront align all activities within the spirit of the regional framework. We believe that the Noront Environmental Assessment has the potential to be a pilot project for future Environmental Assessments in the area.

Investments must be made in the transportation, energy and technology infrastructure that will be needed to bring these projects to fruition. We recognize that the development of this infrastructure will require a substantial investment by the Province; however, the return on investment through $5.75 Billion in tax revenue will more than offset these upfront costs in the long term.

Forestry

Mining is not the only opportunity for economic growth through our natural resources. The forest industry is on the rebound and will continue to grow and prosper with the support of the provincial Government. We thank the Government for making changes to the Ontario Building Code which allows the use of wood in mid-rise construction for buildings of six storeys or less. We believe this will create demand for Ontario’s wood products supporting forest industry jobs and forest dependent communities here in Northern Ontario.

The all-in cost of fibre in the province of Ontario is amongst the highest in the world, which makes it difficult for the provincial forestry sector to remain competitive in a globalized economy. The sustainable use of a secure and affordable supply of renewable wood fibre results in jobs and a wide range of economic benefits. Whether you are an existing mill, new entrant, a big international company or a small family run company, in order to keep people working and put Ontario’s wood to work, the forest products sector needs consistent access to affordable renewable fibre. We encourage the Province to permanently establish through regulation a minimum of 26 million cubic metres per year of accessible fibre for industrial use.

Furthermore, we urge the government to conduct socio-economic impact assessments of all legislation, regulation and policies that could reduce the provincial fibre supply and/or reduce access to the land base.

Energy

The need for reliable and affordable energy is paramount to ensure that manufacturing of forest products and processing of minerals can be done within the region, creating jobs and supporting local communities, rather than being shipped to other jurisdictions. We call on the Government to make the Northern Industrial Electricity Rate program permanent and to ensure that the appropriate power transmission infrastructure is in place to address energy needs.

Hardy Dam Replacement

One additional concern that we want to bring to your attention is the Hardy Dam on Highway 622 near Atikokan.  The Hardy Dam has reached the end of its projected lifespan. Emergency repairs have been made but a long term commitment is required. Failure of this structure will result in the loss of Hwy. 622 and the rail spur that serves the Atikokan Generating Station and will isolate a number of residents, tourist operators, and mineral development sites north of Atikokan. We support the need for a complete replacement of the Hardy Dam and are hopeful that this will be addressed in the coming budget.

Eliminate the Deficit and Reduce the Debt

Ontario’s fiscal situation is precarious and has negative consequences for all Ontarians: it deters private investment and reduces the government’s capacity to make productivity-enhancing investments. Further, it compromises the government’s ability to respond to future economic slowdowns. In the long-run, a slower-growth future and a rapidly aging population will make a large deficit and debt much more difficult to address.

We support the recently released Ontario Chamber of Commerce report that outlines six approaches that the Government can take to reduce spending and improve the efficiency and effectiveness of government programs. We encourage the Government to take bold action to bring the budget back to balance as soon as possible.