Canadian Manufacturing

Feds considering focus on manufacturing in upcoming budget

Manufacturing sector could be focus for Conservatives as part of general shift in attention towards Ontario

OTTAWA—The Conservative government is considering a strong focus on the manufacturing sector in the upcoming budget, part of a general shift in attention towards Ontario and its prospective voters.

Prime Minister Stephen Harper has faced sharp criticism from the opposition parties that he has ignored Canada’s industrial heartland in favour of the energy sector in his home province.

“While Mr. Harper was busy not caring about manufacturing jobs drying up, his finance minister was telling Ontarians they had ‘no one to blame but themselves,'” Liberal leader Justin Trudeau said in a speech to caucus earlier this week in London, Ont.

Harper and his ministers have been concentrating much of their energy in the province, whose manufacturers and exporters stand to benefit from the sagging loonie.

Transport Minister Lisa Raitt and Ontario Premier Kathleen Wynne recently announced $100 million in joint funding for auto parts manufacturer Linamar Corp. in Guelph, Ont.

Harper also finally agreed to meet with Wynne earlier this month, the first time in more than a year.

“The oil industry isn’t remotely the entire Canadian economy,” Harper said at an event in St. Catharines, Ont., as he spoke about the impact of plummeting oil prices.

Industry Minister James Moore recently told CBC News that while the government has done much to advance the cause of oil pipelines, its up to the companies involved to deliver.

That’s a different tone than Harper took shortly after he took office, when he told a British audience that Canada was an “energy superpower,” and that oilsands development was akin to building the Great Wall of China or the pyramids.

It was a phrase that would emerge again during a 2012 trip to China.

Senior Conservative sources emphasize that manufacturing has always been on the radar—a two-year extension of the temporary capital cost allowance for equipment and machinery appeared in the 2013 budget.

Southern Ontario’s auto industry was also given billions of dollars in bailout money in late 2008.

But they also suggest that more help for the sector is top of mind as the April budget is being put together.

For example, the accelerated capital cost allowance lets companies write-off the cost of machinery more quickly, thereby lowering their tax bill.

One option is to make that a permanent measure.

Harper specifically referred to manufacturing this week, when he dismissed the suggestion his government should readjust its economic plan.

The government is already doing plenty to foster economic health, he said, including “cutting red tape, programs to aid the creation of small business and small business jobs, programs to aid in innovation, programs to ensure the manufacturing sector is strong and growing and revitalized, negotiations to open new markets to trade, and keeping our taxes low.”

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