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Quicker spending on infrastructure mulled


OTTAWA—The Trudeau government is “actively considering” speeding up promised investments in infrastructure in a bid to stimulate Canada’s rapidly-deteriorating economy.

Prime Minister Justin Trudeau promised during last fall’s election campaign to pump an additional $60 billion over 10 years into infrastructure projects.

But less than half that money—$17.4 billion—was earmarked to flow during the Liberals’ first mandate.

The platform committed to spending an extra $5 billion for each of the first two years and $3.45 billion in each of the next two years.

However, The Canadian Press has learned the government now is looking at moving up the spending schedule—pushing the money out faster in response to worsening economic conditions.

Commodity prices have continued to slide, the dollar has nosedived, and already sluggish economic growth has slowed to a crawl in the three months since Trudeau won on a platform focused on stimulating the economy and improving the lot of middle-class Canadians.

Asked repeatedly yesterday if the government is considering spending more than the promised $5 billion extra on infrastructure in the coming year, Finance minister Bill Morneau did not rule out the idea.

But he said details will have to await his maiden budget, expected in mid- to late March.

“It will include significant infrastructure spending, but the exact details of the budget we haven’t completed yet so I can’t provide more information on the exact numbers,” Morneau said during a visit to a Toronto refugee centre.

The deteriorating economic situation already has forced the Liberals to rethink their pledge to run up deficits of no more than $10 billion in each of the first three years of their mandate.

Trudeau has downgraded that promise to a “goal.”

While they may yet have to scale back some of their other pricey campaign promises, Trudeau and Morneau have doubled down on the infrastructure spending, arguing the worsening economic picture only reinforces the need to stimulate growth.

During an event yesterday with Toronto Mayor John Tory, Trudeau said his government has no plans to scale back its infrastructure spending.

“The infrastructure investments that the mayor is counting on are not a problem—they are part of the solution to the challenges that Canada has been facing,” Trudeau noted.

“That’s exactly what we’re serious about tackling.”

Last week, Bank of Canada governor Stephen Poloz also weighed in, calling infrastructure spending an “important ingredient” in economic growth.

Sources say the Liberals are looking at speeding up infrastructure spending, but they want to ensure additional money wouldn’t wind up paying for gazebos, park upgrades, and other beautification projects of the sort that were funded in Ontario’s cottage country prior to the 2010 G8 summit.

The Liberal platform talked about investing in more ambitious projects with long-term benefits: public transit, affordable housing, seniors’ facilities, child care, “climate resilient” infrastructure, flood mitigation, and wastewater systems.

Trudeau said yesterday that his government wants to make sure it’s spending money “on the right things” to create jobs and spur the economy in the short term, but also in the long run.

“We’re going to do this right, we’re going to do this responsibly,” he stressed.

Infrastructure minister Amarjeet Sohi said earlier yesterday that the government is looking at expediting spending on projects already queued to receive federal cash through existing infrastructure funds.

“We have billions of dollars that we have not spent over the last two years that we can expedite this year and next year, as well as going through the budget process to allocate the additional $60 billion,” he noted.

Sohi has said funding will flow to shovel-ready projects that cities and provinces identify as priorities.

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