October 29, 2008

British Columbia premier Gordon Campbell unveils economic strategy

RICHARD GILBERT

staff writer

B.C.’s premier unveiled an economic plan last week that includes fast-tracking the construction of infrastructure projects.

During a 12-minute live televised address, Premier Gordon Campbell outlined 10 measures to improve the province’s economic competitiveness and reduce costs for families and business. For the construction industry, one of the most critical parts of the plan is a measure designed to boost economic growth.

“We are going to accelerate public investments in capital infrastructure,” he said.

“A more competitive construction environment, lower interest rates and earlier delivery are all positive benefits for taxpayers. It will help ensure we keep our talented construction trades people at work in every region of the province.”

This measure acknowledges that construction activity in B.C. is slowing and that the government intends to take advantage of falling construction costs on public infrastructure projects, such as hospitals, schools, roads and sewer systems.

“A key determinant for funding will be the speed in which we can get people working, without long lead times,” Campbell said.

The provincial legislature will be recalled to implement the policy package, which includes accelerated income tax cuts for households and businesses, unlimited deposit insurance for credit unions, a rebate of 50 per cent on all school property taxes to light and heavy industry and a re-evaluation of spending priorities.

The plan has met with approval from some in the construction industry.

“At this point in the construction cycle, it makes strategic sense for owners, especially government, to bolster the industry by moving forward with projects,” said Keith Sashaw, president of the Vancouver Regional Construction Association.

“Moderation in commodity prices, cost of materials and availability of labour should make projects that were marginal before, more viable.”

According to the president of the Independent Contractors and Businesses Association (ICBA) the new policy package is an astute move by the government.

“I think it is the right policy for the times because construction costs are much more predictable and our province can afford it,” said Philip Hochstein.

“It (the new policy) won’t affect our bond rating and it is an investment in the future. There will also be a fairly significant multiplier effect for the overall economy.”

For the last several months, the ICBA has been advocating for a greater focus on public infrastructure investment as a strategy for dealing with economic volatility.

Hochstein noted that the government delayed some major infrastructure projects while the market was overheated.

However, with the economy slowing, he said the construction industry now has the capacity to take on new public sector infrastructure projects and help keep people working and the economy growing.

The premier said the new measures are as aggressive as the current fiscal outlook allows, without reducing the government’s ability to balance the budget and increase planned spending on critical services like health or education.

However, one labour leader in the province said the Campbell government has not presented a real plan for the economic crisis that threatens the province.

“We are facing the greatest economic crisis of our lifetime and the Campbell government has resorted to their old tactics,” said Jim Sinclair, president of the B.C. Federation of Labour.

“Tax cuts will come as little relief to British Columbians who have seen their savings disappear or who are worried about their jobs. These cuts will reduce government revenues when they are needed most and, in a blind ideological aversion to deficits, the Campbell government will once again resort to hacking services upon which people rely.”

The leader of the opposition agreed that the 10 point policy package is not a real economic plan.

“British Columbians deserve a substantial plan,” said Carole James, leader of the New Democratic Party.

“They got ten points scribbled on the back of a napkin. Gordon Campbell finally woke up to the economic crisis, but he delivered very little to show that he really gets it.”

According to James, Campbell’s speech was about his political fortunes in upcoming by-elections and in the provincial election next May.

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