Ontario’s Next Generation Jobs Fund

There are some folks that still cling to the notion that Atlantic Canada serves up corporate subsidies to draw industry while Ontario and the other strong economies don’t.

Of course, most – the vast majority of folks realize this is not true. I am watching the Ontario dole out the $1.15-billion Next Generation Jobs Fund. The latest is the $150 million to create jobs in the biopharmaceutical research community with grants, loans, forgivable interest loans.

Even if New Brunswick did a scaled version of that fund it would mean $100 million in new, targeted funding for specific industry sector development.

Because, as we all know, this is just one funding program. There are many more in Ontario – provincial and federal – that are being used to stimulate industrial growth.

For example, ad nauseum, the new $165 million Ontario Venture Capital Fund announced yesterday.

This entry was posted in Uncategorized. Bookmark the permalink.

0 Responses to Ontario’s Next Generation Jobs Fund

  1. Anonymous says:

    The only good program of the lot, is the Ontario Venture Capital Fund, where the province teams with actual venture capital firms to undertake local investments. They’re hoping to mimic the Israeli Yozma model to replace the highly inefficient labour-sponsored funds (which are being phased out by 2010). From what I’ve been able to read up on it, the Ontario government will hand control to either a Boston or Silicon Valley-based fund-of-fund manager, who will be responsible for selecting the venture capital funds to invest in.

    The other programs are useless (typical government industry spending), but at least they’re directed at the right sectors (biotech, new media, etc)

  2. nbt says:

    Depends on who is in charge in Ontario. In the late 80s and early 90s, the Ontario coalition of David Peterson [NDP/Liberal], and then Bob Rae, spent like drunken sailors. But when Mike Harris took over, his government immediately froze business subsidy programs, as well as loans and guarantees, saving $71million in the first year. As well, his government made $1.9 billion in spending cuts in total that first year.

    And he wasn’t the only one to go in that direction in the 90s, the Alberta government of Ralph klein passed legislation to ban corporate welfare permanently. So, yes, there are those (like McGuinty and Rae) who feel comfortable spending their way out of an economic slow down, but there are also those governments [and their leaders] who know the power of low taxes and less spending, or should I say, less interference in the market.

    But you are right, it is up to each and every province to decide what direction they’re going to take on this matter. Plus, they don’t have any power over what the feds do with the TPC program. Hopefully someday they will all be abolished, including the small business loan agency of ACOA. Unfortunately, both are still around instead of tax cuts, but at least there is a bit of transparency with the TPC loans. A small victory.

  3. nbt says:

    Oh, and another thing, speaking of the feds, this past fiscal year [they] transfered out about $40-billion to other levels of government, an increase of about $2-billion or 5.2 per cent over the previous year.

    In other words, we may have a so-called Tory government at the helm, but that didn’t stop the growth in transfers from Ottawa to other levels of government (especially the provinces) wherein it will have grown 23.4 per cent over the two year period ending March 31, 2008.

    Also, the transfers “to persons” — which includes the money Ottawa sends out to individuals in the form of employment insurance, old age benefits and the new universal child care benefit — will total nearly $50-billion in fiscal 2008, an increase of 8.7 per cent compared to fiscal 2007 and an increase of 12.5 per cent over compared to almost three years ago.

    So it really does depend on what the government decides to do with our money as partisanship doesn’t seem to mean a hoot. Liberal Tory same ol’ story.

  4. mikel says:

    Alberta has FAR more corporate welfare than anybody else. We’ve discussed here before about the ONE tax credit that is worth more in Alberta than ALL the equalization that New Brunswick gets each year.

    That’s also besides the Energy Innovation Program which is worth over half a BILLION dollars.

    We’ve had this discussion before, but corporate welfare takes far more forms than writing a cheque. The feds ensuring that natives can’t get access to their own land is worth more than every cheque to every company the government has ever written.

    And of course not making a corporation pay taxes is as much welfare as writing a cheque. Whats the difference between getting a cheque and the government saying ‘just keep all your money’? The only difference is that the cheque is designed for growth, while the tax credit is designed for greed.

    There used to be the old argument that this meant companies would re-invest more in jobs, but we now know thats not true, it just gives them more capital to invest elsewhere, or buy up other industry players or invest in technology that costs jobs.

    In Alberta corporate welfare takes on many forms, as I’ve said before, companies want profits, not risk. So you can go read the reports from the ‘Underground Commission’ about how happy cattle farmers were because ‘we did it without the government’, all til mad cow hit and all of a sudden they were all lined up in Ottawa for multibillion dollar buyout (ironically westerners rarely even mention this in their tirades against centrists and the liberal government).

    Of course its not that simple, as it turns out most of the money went to american companies who owned all the processing plants and prices never went down even though there was a surplus. Funny how nobody ever mentions THAT when they talk about ‘supply and demand’. That was a clear case which had NO government involvement (on the canadian market I mean).

    Alberta hands out grants and loans the same as anybody, you can go to their website and apply online. But the MASSIVE corporate welfare takes a different form-one which New Brunswickers are very familiar with-the simple giveaway of resources.

    That’s worth FAR more than a cheque, just ask Saskatchewan Potash. Alberta’s royalty scheme apparantly is so bad that a tory government had a commission and wanted to change it but faced too much industry opposition.

    But that’s as much corporate welfare as anything else. Here’s a test though, the Saskatchewan deal will only cost NB its potash, which I suppose nobody cares about, nobody was making fertilizer out of it anyway (and now nobody will ever get to), but compare that with the ‘cheque’ that FatKat got for almost 100 grand for new equipment.

    Dollar for dollar the fatkat deal is far better (particularly since it was federal money) because its a company not reliant on a limited resource. The company has grown far faster than ANY resource industry, and in the knowledge economy they are good jobs, unlike the potash inhaling, construction job killing natural resources file.

    The entire tax code is riddled with such examples of corporate welfare. That is simply how the economy operates. As David says, the government simply has no choice or else, well, in NB you know all about the ‘or else’. Or else your government gets run by one family company, your economy gets run by one family that moved all its resources out of the country, etc., etc.

  5. nbt says:

    Geez mikel, I thought Ralph Klein and Mike Harris were retired. According to you, they are still responsible for PC and Liberal policy. How giving of their time they are. 😉

  6. mikel says:

    I don’t know what that means, I never mentioned Klein or Harris. But you are right that parties make no difference, it all depends on economic conditions. That’s why Klein leads the pack over EVERY politician of the last decade and a half in increases in program spending. That’s directly opposite to what you were saying above. And no wonder, Alberta has money coming out their ears and like every other canadian Albertans expect services to go with all that money.

    Ontario did have major cuts, but once again that was due to the economy. Harper wouldn’t last long as PM if he weren’t handing out money faster even than Martin was.

    Lord was way up there as well, far higher than the so called ‘tax and spend’ NDPers in the prairies-even Harcourt was nowhere near leader of the pack. Here’s the breakdown:

    Klein- 10.1 % yearly program spending increases
    MacLellan (NS-L): 7.3
    Martin: 7.1
    Lord: 7.1
    Wells: 7.1
    Calvert (NDP):7
    Harper: 6.9
    Mcguinty: 6.9
    Campbell: 6.9
    Romanow: 6.5
    Clark (NDP): 6.3
    Tobin: 6.1

    Etc., down to the low end, all of which are liberals, two of which are from NB-Graham, McKenna and finally Chretien.

    So absolutely, party has zero to do with it, it all depends how much cash is laying around. That’s a party line you hear all the time, there are bloggers who won’t even mention the NDP without calling them ‘tax and spend’ when they are all only in the middle of the pack.

    Like corporate welfare there are very easy ways of increasing taxes. In ontario Harris did it by lowering taxes by downloading everything onto municipalities, so much so that municipal taxes have had an increase about level with the provincial reductions-plus far fewer services.