Engaging in a dynamic emerging market of 45 million people and an economy with high growth potential

(No. 98 – March 10, 2010 – 3:45 p.m. ET) The Honourable Peter Van Loan, Minister of International Trade, and the Honourable Jean-Pierre Blackburn, Minister of Veterans Affairs and Minister of State (Agriculture), today followed through on a commitment made in last week’s Speech from the Throne by tabling legislation to implement the Canada-Colombia Free Trade Agreement. At the same time, the government is also tabling parallel labour and environment agreements with Colombia.

“International trade is critical to our economic recovery,” said Minister Van Loan. “As we move beyond stimulus spending and diversify opportunities for Canadian business abroad, this free trade agreement will help Canadians prosper. At this time of global economic recovery, Canadians can count on our government to oppose protectionism and defend free and open trade on the world stage. Canadian businesses and workers can compete with the best in the world, and this agreement will help them do it.”

The Canada-Colombia Free Trade Agreement will provide greater market access for Canadian exporters of goods such as wheat, pulses, barley, paper products and heavy equipment. An increasing number of Canadian investors and exporters are entering the Colombian market, and it is also a strategic destination for Canadian direct investment, especially in mining, oil exploration, printing and education.

“The Free Trade Agreement, along with its parallel agreements on labour and the environment, is but one of several Government of Canada instruments that support Colombia’s efforts toward greater peace, security and prosperity,” said Minister Van Loan.

Under the Labour Cooperation Agreement, Canada and Colombia agree to respect and enforce internationally recognized labour standards and principles, such as freedom of association, the right to bargain collectively, and the elimination of child labour, forced labour and workplace discrimination. The Agreement on the Environment commits Canada and Colombia to pursuing high levels of environmental protection as the two countries intensify their commercial relationship, and to avoid weakening their environmental laws to encourage trade or investment.

This free trade agreement is part of a broader international trade strategy to improve Canadian companies’ access to key international markets and to enhance opportunities for Canadian exporters and investors. Canada has free trade agreements in force with Chile, Costa Rica, the European Free Trade Association countries, Israel, Peru, and Mexico and the United States together. It has concluded free trade negotiations with Jordan and Panama. Canada is continuing trade talks with the Caribbean Community, Central America, the Dominican Republic, the European Union, India and the Republic of Korea.

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YELLOWKNIFE (March 1, 2010) – Finance Minister J. Michael Miltenberger today launched public discussions on a proposed Heritage Fund.

“The NWT is blessed with a vast treasure of non-renewable resources,” said Minister Miltenberger. “However, once these resources are taken out of the ground they are gone forever. Our challenge is to ensure that the transformation of our non-renewable resources to dollars provides a lasting legacy for NWT residents.”

Once devolution of the NWT’s non-renewable resources is achieved, royalty revenues currently flowing to Canada will be paid to NWT governments. Although part of the revenues will be offset by lower federal transfer payments, the GNWT will face a number of choices and opportunities for the use of the net fiscal benefit.

“A Heritage Fund will allow us to protect the net revenues from resource development and make them available for investment in long-term assets for future generations,” Minister Miltenberger said.

With broad support for the concept of a heritage fund from public discussions, Minister Miltenberger says he believes the GNWT can have legislation in place to create a Heritage Fund by the end of the 16th Legislative Assembly.

The Heritage Fund discussion paper is available on the Department of Finance’s web site at www.fin.gov.nt.ca.

Comments on the creation of a Heritage Fund should be submitted by April 30, 2010 to:

Heritage Fund Discussions
Fiscal Policy Division, Department of Finance
Government of the Northwest Territories
PO BOX 1320 L-5
YELLOWKNIFE, NT X1A 2L9

Or by e-mail to: Heritage_Fund@gov.nt.ca

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Labour and Workforce Development

The Nova Scotia Pension Review Panel filed its final report last year and the department has accepted about 90 per cent of the recommendations. The department wants more input on the review panel’s proposed funding formula and whether there should be more flexibility for private-sector pension plans, based on risk, funding arrangements and governance.

“Currently, we work under a one-size-fits-all system of regulation,” said Minister of Labour and Workforce Development Marilyn More. “We want to move to a system that supports improved governance and accountability of private-sector pension plans.”

Government has responded to pressures created by a weak investment market and low interest rates over the past few years, and, in November, amended the Pension Benefits Act regulations to address solvency pressures.

Input from employers, unions, members, plan administrators and pension committees is needed because hard decisions may have to be made for some plans to continue to meet the needs of their members and provide benefits promised to retirees.

“We want to be proactive to assist pension plans in meeting the challenges they face,” said Ms. More.

The discussion paper is available on the department’s website: www.gov.ns.ca/lwd .

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Canada has returned to economic growth following the deepest global economic recession since the 1930s. The global recovery, however, remains fragile.

Budget 2010 aims to contribute to this recovery and sustain Canada’s economic advantage now and for the future. The budget plan has three broad aims.

First, it confirms $19 billion in new federal stimulus under Year 2 of Canada’s Economic Action Plan to create and maintain jobs, complemented by $6 billion from provinces, territories, municipalities and other partners.

Second, it invests in a limited number of new, targeted initiatives to build jobs and growth for the economy of tomorrow, strengthen Canadian innovation, and make Canada a destination of choice for new business investment.

Third, Budget 2010 charts a course to bring Canada’s finances back to balance over the medium term and well before any other Group of Seven (G7) country.

By making timely investments that fit firmly within the Government’s long-term economic vision for Canada, and thanks to the resilience and ingenuity of Canadians, our country will emerge from the recession with a stronger economic advantage than before.

The Canadian brand will be based on competitive taxes, renewed infrastructure and skills, a strong head start in clean energy, a tariff advantage, less red tape, and a more prominent voice as a global financial sector leader.

Together, we will create a stronger Canada and a stronger economy, now and for the future.

Delivering Year 2 of Canada’s Economic Action Plan

Actions taken under Canada’s Economic Action Plan have helped ensure the worst of the global recession lies behind us.

However, while a recovery has begun, it remains fragile and too many Canadians remain out of work. This is why the Government will follow through on its commitment to Canadians and its G7 and G20 partners to deliver Year 2 of the stimulus plan.

Over the next fiscal year, Year 2 of the Economic Action Plan will continue to maintain and create jobs, and help Canadian workers and families manage through still difficult economic conditions, including:

• $3.2 billion in personal income tax relief. This includes allowing Canadians to earn more income before paying federal income tax and before being subject to higher tax rates. It includes the enhanced Working Income Tax Benefit to strengthen work incentives for low-income Canadians. Tax measures for 2010–11 also include higher child benefits for parents and lower taxes for low and middle-income seniors.
• Over $4 billion in actions to create and protect jobs. This includes additional Employment Insurance (EI) benefits and more training opportunities to help unemployed Canadians through this difficult period, and help ensure they are equipped to re-enter the workforce and prosper in the future.
• $7.7 billion in infrastructure stimulus to create jobs. This will modernize infrastructure, support home ownership and improve social housing across Canada. This builds on the $8.3 billion investment in infrastructure and housing delivered in 2009–10.
• $1.9 billion to create the economy of tomorrow. This investment will help develop and attract talented people, strengthen our capacity for world-leading research, improve commercialization, accelerate private sector investment, enhance the ability of Canadian firms to participate in global markets, and create a more competitive business environment.
• $2.2 billion to support industries and communities. This will support adjustment and provide job opportunities in all parts of Canada that have been hit hard by the economic downturn. It provides support for affected sectors, including forestry, agriculture, small business, tourism, shipbuilding and culture. In addition, the proposed elimination of tariffs on manufacturing inputs and machinery and equipment will encourage investment in the manufacturing sector.

Canadians in all regions have already benefited from the implementation of Canada’s Economic Action Plan in Year 1:

• Commitments are in place for almost 16,000 projects across the country. Over 12,000 of these projects have begun or have been completed.
• One objective of the Economic Action Plan was to maintain or create 220,000 jobs. The Action Plan is on track. It has contributed to the creation of over 135,000 jobs recorded in Canada since July 2009.

At the same time, the Action Plan will advance the objectives set out in our long-term economic plan, Advantage Canada.

New Investments in Jobs and Economic Growth

In addition to delivering Year 2 of Canada’s Economic Action Plan, Budget 2010 introduces a limited number of new and targeted actions to protect Canadians from the global recession and create the jobs and economy of tomorrow.

Jobs Protection and Youth Employment Measures

Budget 2010 invests in measures that will directly protect jobs. This includes extensions to work-sharing and investments in training and skills development for youth.

Creating Economic Growth and Jobs Through Innovation

Budget 2010 builds on earlier investments with over $600 million over three years to help develop and attract talented people, to strengthen our capacity for world-leading research and development, and to improve the commercialization of research.

Encouraging Investment and Trade to Create Jobs and Growth

Budget 2010 takes action to improve the environment for investment, enhance competition and reduce barriers for businesses. This includes making Canada a tariff-free zone for manufacturers, by eliminating all remaining tariffs on productivity-improving machinery and equipment and goods imported for further manufacturing in Canada. This initiative, when fully implemented, will provide $300 million in annual duty savings to Canadian business.

Proposed improvements to the international tax system to attract new investment, cuts to red tape for businesses and increased competition for telecommunications will also foster investment and create jobs for Canadians.

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VICTORIA – Setting the foundation for decades of renewed economic growth, protecting vital services, adding to British Columbia’s competitiveness and building on the tremendous momentum of the 2010 Olympic and Paralympic Winter Games are core elements of the 2010 provincial budget tabled in the B.C. Legislature today by Finance Minister Colin Hansen.

“We are enhancing support for B.C.’s families, meeting our financial targets, maintaining our commitments to health and education, and we are on track to return to balanced budgets in 2013,” said Hansen. “Recognizing the many opportunities resulting from the global exposure provided by the Olympic Games, we are also furthering our investments in areas such as clean energy, arts and culture and international commerce while ensuring future job growth across B.C.”

Budget 2010 maintains the government’s priority of protecting core services in health and education and commits every dollar raised through the Harmonized Sales Tax (HST) and four other revenue streams to be used for health services funding when the HST comes into effect July 1, 2010.

By 2012-13 the Ministry of Health Services’ budget will increase by over $2 billion from the 2009-10 level. Total health spending will reach $17.9 billion or 42 per cent of all government expenditures over the next three years. Funding increases are focused on sustaining front-line service delivery, including $1.3 billion for the regional health sector to fund acute-care, community, assisted-living and other health services.

In education, per-pupil funding for students in the K-12 levels will rise from $8,200 in 2009-10 to an estimated $8,301 for 2010-11, the highest ever. Further supporting families and early-childhood education, the introduction of full-day kindergarten for five-year-olds is being phased in starting this September, and as it becomes fully operational, annual funding will rise to $129 million by 2012. In the post-secondary sector, funding remains stable at $1.88 billion in 2010-11.

With Budget 2010, the B.C. government continues to invest in job-creating construction projects such as highways, schools, bridges, hospitals and other needed infrastructure throughout British Columbia.

$5.3 billion has been committed to over 850 accelerated capital projects across British Columbia, an increase of $1.9 billion since the September Update 2009. This is generating and protecting approximately 34,000 construction jobs over the life of the projects in communities across B.C.

Budget 2010 also provides a new property tax deferral program for homeowners with children under the age of 18. Eligible homeowners will have the option of deferring their provincial and local property taxes in recognition of the high cost of raising a family. This program will come into effect in the next few months.

An additional $26 million in funding over three years has been set aside to support child-care programs that assist low and moderate income families with the cost of child care through direct assistance to families for child care and funding to child-care operators.

As part of the Province’s long-term vision for economic growth, expansion of the International Financial Activity Program will greatly increase B.C.’s potential as a hub for international companies. Major changes include adding digital-media publishing and distribution; certification and trading of carbon credits; and clean technology to the list of businesses that qualify for tax reductions under the program.

A new tax credit has also been introduced for digital media and enhancements to provincial film-tax credits have been made to reflect the convergence of these sectors and their importance to the B.C. economy.

To maintain B.C.’s leadership in addressing climate change, Budget 2010 commits $100 million to climate action and clean-energy development, initiatives that will support new jobs and investments in B.C. communities, while lowering greenhouse gas emissions. An additional $35 million will be invested in the successful LiveSmart BC program for household-energy audits and energy-efficiency retrofits.

The budget also provides $60 million over the next three years as a legacy for sports and the arts. Of the $60 million, half will be used to enhance opportunities among British Columbians in the arts, such as visual art, music, theatre and dance. The other $30 million will facilitate increased participation in youth sport, including improved athlete and coach development.

“Building on the legacy of the most successful Winter Games ever, we are positioning British Columbia for renewed growth and prosperity, while ensuring our financial resources are clearly focused on areas that meet tomorrow’s needs as well as today’s,” said Hansen. “Through effective and prudent management of the Province’s finances, we are setting the foundation for the province we want — not just five or 10 years from now — but for generations to come.”

For the Finance Minister’s speech and more details on Budget 2010, visit www.bcbudget.ca.

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Feb. 24, 2010

FREDERICTON (CNB) – The provincial government has introduced an amendment to the Insurance Act that will increase its ability to prohibit underwriting and rating practices to all classes of insurance beyond automobile insurance.

Regulations will prohibit using credit scoring for underwriting and rating of property and casualty insurance, including automobile insurance.

New Brunswick will become the first province to introduce such prohibitions. Alberta and Ontario prohibit the use of credit scores, but only for automobile insurance.

“Consumers and regulators are concerned about the increased use of credit scores for underwriting and rating,” said Kelly Lamrock, minister of justice and consumer affairs as well as attorney general.

“It is patently unfair for persons who may have missed a payment on a loan at some point in their lives to have that reflected on their insurance premiums. Further, there are many circumstances that have little or nothing to do with a person’s ability to manage his or her finances – including identity theft, sudden family or medical crises, sudden unemployment or other catastrophic events.”

The provincial government is making these changes to ensure fairness and access to insurance for all consumers.

“As a government we understand that getting affordable insurance can already be challenging enough in some circumstances,” said Lamrock. “We are pleased to bring forward changes to the Insurance Act to provide even greater protection for consumers.”

The Office of the Consumer Advocate and the Insurance Brokers Association of New Brunswick have called for an end to using credit scoring in underwriting and rating.

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The Honourable Jim Flaherty, Minister of Finance, today welcomed the launch of an unprecedented public consultation with Canadians on financial literacy, as the Task Force on Financial Literacy released a discussion paper entitled Leveraging Excellence.

“All Canadians are working toward a personal goal, be it retiring, buying a home or attending college or university,” said Minister Flaherty. “As these goals have financial implications, Canadians would benefit by becoming better consumers, investors and savers.”

The Task Force, announced by Minister Flaherty as part of Canada’s Economic Action Plan, released the discussion paper to mark the beginning of a three-month national consultation. The Task Force will meet with Canadians in 15 cities across the country and host an interactive online forum. After consultations are complete, the Task Force will make recommendations to create a national strategy to enhance financial literacy.

“Canadians face a growing number of complex financial decisions that affect their futures and steer our economy,” said Minister Flaherty. “That’s why it is important for Canada to have a national strategy aimed at promoting and strengthening financial literacy.”

Minister Flaherty said financial literacy is a key priority for the Government. He noted that funding has been provided to the Financial Consumer Agency of Canada since 2007 to undertake financial literacy initiatives such as The City, an interactive education resource for high-schoolers available from coast to coast to coast.

“Our Government has acted to protect consumers in many areas, from credit card regulations to rules to improve disclosures on loans,” said Minister Flaherty. “Last week, we took a number of measured steps to support the long-term stability of Canada’s housing market and continue to encourage home ownership by Canadians. Having a national strategy to improve financial literacy will be an important means to ensure Canadians are able to make informed and prudent financial decisions throughout their lives.”

Minister Flaherty encouraged all Canadians to take part in the consultations and make their voices heard. Further details about the consultations and the discussion paper are available on the Task Force’s website at www.financialliteracyincanada.com.

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VICTORIA – A new report on British Columbia’s International Financial Activity (IFA) program recommends enhancements that would position Vancouver as a premier centre for international commerce and support jobs and expansion in the growing clean technology, green economy and digital media sectors, Finance Minister Colin Hansen announced today.

“British Columbia’s prowess and potential in green building and carbon-emission management are showcased in the venue architecture, clean technology and carbon offsets sourced for the 2010 Winter Olympic and Paralympic Games,” said Hansen. “As with our athletes, give B.C. businesses the opportunity and they can go head-to-head with the world. Growing the $35-billion B.C. financial sector by attracting international professionals, head offices and capital to our diverse, multilingual and highly educated workforce will not only generate high-quality financial jobs, but also foster a pool of venture capital to leverage B.C.’s Renaissance Fund to support jobs and innovation in the sectors of our economy’s future.”

The Province intends to introduce legislation that will incorporate many of the recommendations contained in the report. The report recommends expanding the IFA program in a number of areas including:

• Digital media publishing and distribution.
• Clean technology.
• Management of investment funds.
• Companies providing services related to certifying and trading carbon credits to non- residents.

“Vancouver is becoming a more prominent player on the global financial stage and is now set to establish itself as a leading destination,” said Iain Black, Minister of Small Business, Technology and Economic Development. “A strong IFA program will ensure Vancouver and British Columbia remain competitive and attractive to international investors who are seeking a safe and stable place to invest.”

The report highlighted many of Vancouver’s existing strengths that benefit financial services firms, including favourable tax treatment, a labour pool of more than 100,000 finance professionals, and an educated and multilingual workforce with global connections. The city is currently ranked 29th on the Global Financial Centres Index, three spots ahead of Montreal.

The report also points to the leadership of sectors in British Columbia’s economy that would most benefit from the strengthening of Vancouver as a centre for global finance, such as:

• The clean technology sector, which has attracted global attention and investment in a market projected to double to US $2,740 billion by 2020.
• The carbon trading sector, where there is a significant opportunity for B.C. to become a centre for such functions of the carbon market as the management of the sale and purchase of carbon offsets or renewable energy certificates through financing, verification and accounting.
• The digital media sector, which in B.C. is comprised of more than 1,000 companies that employ over 15,000 people and generate gross annual revenue of $1.2-$1.4 billion, 40 per cent of which comes from sales to the U.S. and European Union. PricewaterhouseCoopers estimates the U.S. entertainment market will grow at 4.8 per cent per year to $759 billion in 2012, with digital and mobile distribution accounting for 24 per cent of the growth in the next three years.

The report was prepared by the Vancouver International Financial Sector Steering Committee. The steering committee was established in 2009 to provide recommendations to the Province on enhancing Vancouver as a top-tier international financial centre.

“The report identifies improvements to the existing program that could create more than 13,000 full-time jobs and contribute an additional $1.3 billion to the provincial economy,” said co-chair Milton Wong. “The powerful ripple effect of these changes would also generate significant new investment and commerce in many other different sectors of our economy.”

“Through expansion of the existing IFA program, B.C. has an opportunity to capitalize on the reputation and strength of the Canadian financial system by promoting itself internationally and increasing economic activity and benefits,” said co-chair Tracey Orr.

The IFA program was established in 1988 to draw international financial activity to B.C. In 2004, the program was expanded to include additional international financial activities and expand eligibility for tax refunds under the program. Qualifying activities include lending, treasury functions, factoring trade account receivables, distributing film and television rights, leasing property, certain insurance and foreign exchange activities, back-up office, administrative support services and commercialization of life science and green related patents.

B.C. INTERNATIONAL FINANCIAL ACTIVITY PROGRAM

B.C.’s International Financial Activity (IFA) program was introduced to further develop Vancouver as an international financial centre.

The legislative framework for the IFA program is the International Financial Activity Act (IFAA), which took effect on September 1, 2004. The IFAA replaced the International Financial Business (Tax Refund) Act.

The IFA program provides eligible corporations with a refund of provincial corporate income tax paid on qualifying activities:

o   A corporation may receive an annual refund of up to 100 per cent of the provincial corporate income tax paid on income earned from eligible activities transacted with a non-resident of Canada.

o   To qualify for a refund, a corporation must be registered under the IFA program and be incorporated in Canada with a permanent establishment in B.C.

o   Qualifying activities include: making loans, factoring trade accounts receivables, distribution of film and television rights, leasing property, captive insurance activities, foreign exchange activities, back-up office and administrative support services.

The IFA program also provides refunds of up to 75 per cent of corporate provincial income tax on income from the commercialization of certain types of life science and “green” patents.

The IFA program is administered by the Ministry of Finance. To qualify for the program, registration with the Ministry of Finance is required. Successful applicants must also become members of the International Financial Centre BC, a non-profit society with a mandate to promote international financial activity in B.C.

www.gov.bc.ca.

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Economic and Rural Development

A new 10 per cent investment credit will allow businesses to improve operations and become more competitive, more productive and more sustainable.

“Nova Scotia businesses are facing critical changes and an increasingly competitive environment,” said Economic and Rural Development Minister Percy Paris. “At a time when the economy needs stimulation, this investment is a strong signal of support to this sector.”

The program, originally announced by Premier Darrell Dexter last fall, is an incentive to manufacturers and processors. It offsets the cost of purchasing new technology, machinery and equipment, and the savings are reinvested into the businesses.

“This is an investment that will pay significant dividends,” said Mr. Paris. “Productive and competitive firms often lead to better-paying, higher-skill jobs that are able to survive in the long term. And the money saved will stay right here in Nova Scotia.”

Administered by the Department of Economic and Rural Development, the program will reimburse companies investing $50,000 or more in a project for 10 per cent of the costs, to a maximum of $1 million. The credit is for eligible investments made after Jan. 1. The budget is $4.5 million for this fiscal year and starting in 2011-12, the program will have an annual budget of $25 million.

The province, in consultation with industry, developed the program to ensure it met the needs of the manufacturing and processing sector and that as many companies as possible could access the initiative.

“We are very pleased that government has listened to the needs of innovative manufacturers in Nova Scotia,” said Ann Janega, vice-president, Nova Scotia division of the Canadian Manufacturers and Exporters. “The new credit program is accessible, efficient and effective in improving productivity. It will increase the competitiveness of the manufacturing sector and create more jobs for Nova Scotians.”

The Manufacturing and Processing Investment Credit builds on the 10 per cent Atlantic Investment Tax Credit offered by the federal government for manufacturing and processing activities.

More information on the program, including guidelines and an application form, is available at www.gov.ns.ca/econ/mpic .

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