OTTAWA — A federal policy think tank says the federal Liberal government's cornerstone economic policy is rudderless and could be dead in the water without a strategy on how to spend billions in new infrastructure money.
In a paper released today, the Public Policy Forum argues for the need for a pan-Canadian infrastructure strategy over the next three decades to ensure governments spend on projects that will produce long-term gains.
Finance Minister Bill Morneau speaks in Toronto Monday, October 3, 2016. (Photo: Nathan Denette/CP)
The paper, titled "Building the Future: Strategic Infrastructure for Long-Term Growth," lands as the Public Policy Forum hosts bank executives, top academics, cabinet ministers and experts at a an economic summit in Ottawa.
The Liberals have made infrastructure spending central to their plan to create jobs and prod the sluggish Canadian economy. Indeed, Canadian governments are expected to spend as much as $750 billion over the next 10 years on infrastructure.
As a result, now's the time to create a national infrastructure strategy after years of successive federal governments handing over money to provinces and cities without a clear, national vision, the paper argues.
Promise was 'the easy part'
"The Liberal government committed to doubling federal infrastructure spending. That was the easy part," writes Drew Fagan, a former Ontario deputy infrastructure minister.
"Canada won't become an infrastructure leader, and therefore an economic leader, unless those funds are employed as part of a much more sophisticated strategy of world-class planning, delivery and operations."
The Liberals promised in last year's election to pump $60 billion of new money into federal infrastructure spending over the next decade, with the funds split between public transit projects, "green" infrastructure like sewers and water treatment plants, and social infrastructure like daycare, affordable housing and seniors’ residences.
The Liberal budget delivered last March detailed an initial tranche of spending worth $11.9 billion over two years.
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Federal Budget 2016 Highlights
The government has been consulting provinces, cities, experts, and private pension funds about how it should design the second phase of the program, which will dole out almost $50 billion in remaining funds. The details of the new program are expected to be out by next year's budget.
The Public Policy Forum heard from municipal and provincial officials anxious for a cohesive strategy — and frustrated about a lack of federal guidance on the path forward, Fagan writes.
The paper suggests the federal government should look beyond "current, fleeting pressures" and think long-term about future infrastructure needs, such as roads and networks that can handle self-driving vehicles.
That means ditching the idea of shovel-ready projects "favoured by those looking to get an instant shot of construction-site adrenalin," but which often fail to deliver lasting strategic benefits, Fagan argues.
He also calls for more user fees to pay for new infrastructure like roads and bridges instead of tax dollars — a measure the Liberals balked at in cancelling planned tolls on the replacement for Montreal's Champlain Bridge.
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