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Conference Board Says Red Deer’s Economy On “Solid Footing”

Published

7 years ago

3 minute read

The Conference Board of Canada says Red Deer’s and Medicine Hat’s economies should both see positive growth this year and next. They’ve released the following information explaining their outlook:

In line with recovering oil prices, economic growth in Medicine Hat and Red Deer is expected to return to positive territory this year. In fact, with real GDP growth of 2.7 per cent in 2017, Medicine Hat is anticipated to post the strongest economic growth among the eight mid-sized cities included in The Conference Board of Canada’s latest Mid-Sized Cities Outlook. Meanwhile, Lethbridge—the other Alberta city included in this report—will continue to enjoy steady economic growth.

The outlook is also generally positive for the cities located outside Alberta. Of the five remaining mid-sized cities included in this outlook—Brandon, Prince George, Timmins, Sault Ste. Marie, and Miramichi—all except Prince George will also see economic activity improve in 2017. And even though growth is poised to slow in Prince George, the economy is still projected to expand at a decent 1.5 per cent clip. On a negative note, all five of these cities are on track to see economic growth come in below 2 per cent this year, with Miramichi and Sault Ste. Marie expected to see growth come in below 1 per cent.

“The economies of Red Deer and Medicine Hat, with their close ties to the oil and gas sector, were hard hit by the commodities price crash. Lethbridge’s broad-based economy, however, bucked the provincial trend and managed to emerge unscathed over the last two years,” said Alan Arcand, Associate Director, Centre for Municipal Studies, The Conference Board of Canada. “This year, these three Alberta mid-sized cities will see many of their key industries benefit from recovering oil prices, the low Canadian dollar, and a healthy U.S. economy.”

Red Deer’s economy also suffered back-to-back declines in 2015 and 2016 due to the drop in oil and cattle prices. The local economy will be on more solid footing this year and next with real GDP poised to rebound by 2.0 per cent this year and 2.2 per cent in 2018. Along with primary and utilities sector, Red Deer’s construction and manufacturing industries will both benefit from the gradual recovery in oil prices. The local construction sector was the hardest hit by the downturn in oil prices, as both residential and non-residential investment dried up, contracting by an annual average pace of 17.6 per cent over the last two years. This year, the sector is anticipated to grow by 2.9 per cent, as investor confidence starts to improve. Job growth is poised to resume in Red Deer this year, following a record 8.4 per cent drop in 2016.

Related Topics:City of Red Deer Conference Board Of Canada Red Deer's Economic Outlook

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Broken ‘equalization’ program bad for all provinces

Published on November 21, 2024

Todayville

From the Fraser Institute

By Alex Whalen and Tegan Hill

Back in the summer at a meeting in Halifax, several provincial premiers discussed a lawsuit meant to force the federal government to make changes to Canada’s equalization program. The suit—filed by Newfoundland and Labrador and backed by British Columbia, Saskatchewan and Alberta—effectively argues that the current formula isn’t fair. But while the question of “fairness” can be subjective, its clear the equalization program is broken.

In theory, the program equalizes the ability of provinces to deliver reasonably comparable services at a reasonably comparable level of taxation. Any province’s ability to pay is based on its “fiscal capacity”—that is, its ability to raise revenue.

This year, equalization payments will total a projected $25.3 billion with all provinces except B.C., Alberta and Saskatchewan to receive some money. Whether due to higher incomes, higher employment or other factors, these three provinces have a greater ability to collect government revenue so they will not receive equalization.

However, contrary to the intent of the program, as recently as 2021, equalization program costs increased despite a decline in the fiscal capacity of oil-producing provinces such as Alberta, Saskatchewan, and Newfoundland and Labrador. In other words, the fiscal capacity gap among provinces was shrinking, yet recipient provinces still received a larger equalization payment.

Why? Because a “fixed-growth rule,” introduced by the Harper government in 2009, ensures that payments grow roughly in line with the economy—even if the gap between richer and poorer provinces shrinks. The result? Total equalization payments (before adjusting for inflation) increased by 19 per cent between 2015/16 and 2020/21 despite the gap in fiscal capacities between provinces shrinking during this time.

Moreover, the structure of the equalization program is also causing problems, even for recipient provinces, because it generates strong disincentives to natural resource development and the resulting economic growth because the program “claws back” equalization dollars when provinces raise revenue from natural resource development. Despite some changes to reduce this problem, one study estimated that a recipient province wishing to increase its natural resource revenues by a modest 10 per cent could face up to a 97 per cent claw back in equalization payments.

Put simply, provinces that generally do not receive equalization such as Alberta, B.C. and Saskatchewan have been punished for developing their resources, whereas recipient provinces such as Quebec and in the Maritimes have been rewarded for not developing theirs.

Finally, the current program design also encourages recipient provinces to maintain high personal and business income tax rates. While higher tax rates can reduce the incentive to work, invest and be productive, they also raise the national standard average tax rate, which is used in the equalization allocation formula. Therefore, provinces are incentivized to maintain high and economically damaging tax rates to maximize equalization payments.

Unless premiers push for reforms that will improve economic incentives and contain program costs, all provinces—recipient and non-recipient—will suffer the consequences.

Authors:

Alex Whalen and Tegan Hill

National

Liberals, NDP admit closed-door meetings took place in attempt to delay Canada’s next election

Published on November 12, 2024

Todayville

From LifeSiteNews

By Anthony Murdoch

Pushing back the date would preserve the pensions of some of the MPs who could be voted out of office in October 2025.

Aides to the cabinet of Prime Minister Justin Trudeau confirmed that MPs from the Liberal and New Democratic Party (NDP) did indeed hold closed-door “briefings” to rewrite Canada’s elections laws so that they could push back the date of the next election.

The closed-door talks between the NDP and Liberals confirmed the aides included a revision that would guarantee some of its 28 MPs, including three of Trudeau’s cabinet members, would get a pension.

Allen Sutherland, who serves as the assistant cabinet secretary, testified before the House of Commons affairs committee that the changes to the Elections Act were discussed in the meetings.

“We attended a meeting where the substance of that proposal was discussed,” he said, adding that his “understanding is the briefing was primarily oral.”

According to Sutherland, as reported by Blacklock’s Reporter, it was only NDP and Liberal MPs who attended the secret meetings regarding changes to Canada’s Elections Act via Bill C-65, An Act to Amend the Canada Elections Act before the bill was introduced in March.

As reported by LifeSiteNews before, the Liberals were hoping to delay the 2025 federal election by a few days in what many see as a stunt to secure pensions for MPs who are projected to lose their seats. Approximately 80 MPs would qualify for pensions should they sit as MPs until at least October 27, 2025, which is the newly proposed election date. The election date is currently set for October 20, 2025.

Sutherland noted when asked by Conservative MP Luc Berthold that he recalled little from the meetings, but he did confirm he attended “two meetings of that kind.”

“Didn’t you find it unusual that a discussion about amending the Elections Act included only two political parties and excluded the others?” Berthold asked.

Sutherland responded, “It’s important to understand what my role was in those meetings which was simply to provide background information.”

“My role was to provide information,” replied Sutherland, who added he could not provide the exact dates of the meetings.

MPs must serve at least six years to qualify for a pension that pays $77,900 a year. Should an election be called today, many MPs would fall short of reaching the six years, hence Bill C-65 was introduced by the Liberals and NDP.

The Liberals have claimed that pushing back the next election date is not over pensions but due to “trying to observe religious holidays,” as noted by Liberal MP Mark Gerretsen.

“Conservatives voted against this bill,” Berthold said, as they are “confident of winning re-election. We don’t need this change.”

Trudeau’s popularity is at a all-time low, but he has refused to step down as PM, call an early election, or even step aside as Liberal Party leader.

As for the amendments to elections laws, they come after months of polling in favour of the Conservative Party under the leadership of Pierre Poilievre.

A recent poll found that 70 percent of Canadians believe the country is “broken” as Trudeau focuses on less critical issues. Similarly, in January, most Canadians reported that they are worse off financially since Trudeau took office.

Additionally, a January poll showed that 46 percent of Canadians expressed a desire for the federal election to take place sooner rather than the latest mandated date in the fall of 2025.