TORONTO -
Northern Ontario businesses will see tax cuts as part of the government's plan to boost a regional economy hard-hit by a major downturn in the manufacturing sector, but critics say that doesn't go far enough to attract new investment or help families rocked by massive job losses.
The province will spend $508.7 million over four years to help stimulate growth in the north, including accelerating promised cuts to the Business Education Tax, reducing red tape and pouring new money into infrastructure, Finance Minister Dwight Duncan announced Tuesday.
"Small businesses create jobs for Ontario communities and we thank them for their advice on reducing Business Education Tax rates and their paper burden,'' Duncan said in his budget speech.
A cut to the property tax, announced in last year's budget, will be sped up in 85 northern municipalities -- a move groups urged the Liberals to make ahead of Tuesday's budget.
The tax cut will come four years earlier than expected and will reach a maximum rate of 1.6 per cent, lower than the current average rate of 1.85 per cent, finance ministry officials said.
"Over three years, this will save northern businesses a total of more than $70 million,'' Duncan said.
The beleaguered forest sector, hard hit by the soaring loonie and rising energy prices, will be helped by a reduction in stumpage fees to spur investment in under-used tree species, and pricing that will encourage the use of forest biofibre for energy production and other products.
The stumpage fee for poplar hardwood will be lowered to $2.76 per cubic metre, bringing it on par with the white birch rate starting April 1.
The Liberals will also modernize Ontario's business and financial regulations by implementing an "aggressive'' cap-and-trade policy that will eliminating regulations when new ones are introduced, Duncan added.
But that won't cut down on the onerous red tape that's strangling businesses and chasing away new investment, Progressive Conservative Leader John Tory said. The tax load on companies is one of the highest in North America, yet the Liberals have chosen to do little about it, he said.
"So when it comes to competing for those manufacturing jobs, which we have to do, we're in a position where we're really not much better off today than we were yesterday after this budget,'' Tory added.
"We're in a situation where Ontario's tax-and-spend and regulatory policies are chasing jobs out of Ontario and failing to attract the ones we need.''
NDP Leader Howard Hampton, who represents a northerwestern Ontario riding, slammed the budget as providing little aid to manufacturers, particularly in the ailing forestry sector.
"The part of the province I come from, I've watched 10,000 manufacturing jobs disappear in the forest sector,'' he said.
"I look immediately across the border in Manitoba, not one paper mill, not one pulp mill, not one OSB mill, not one sawmill has been shut down. In fact, Manitoba has actually added jobs in that subsector of manufacturing.''
Even the centrepiece of Tuesday's budget -- a three-year, $1.5-billion program to help laid-off workers retrain for new jobs -- isn't enough for families struggling with massive job losses in manufacturing, Hampton said.
"Training for 20,000 when over 200,000 have lost their jobs is pretty thin gruel,'' he said.
While encouraging growth in key industries like mining, the province said is also plans to pump more funds to help students, provide better access to health care and improve infrastructure in the north.
Students attending school in remote and rural areas will have access to $27 million over three years to help cover travel costs, while a program that provides grants to help northerners access health-care services will receive a $13-million boost.
Duncan said northern infrastructure will also get significant cash, including $302 million over the next four years for highways and additional cash injections for other municipal infrastructure projects.
The province will also help establish two centres in Thunder Bay, allocating $25 million for a bio-economy research centre focused on forestry and another $9.7 million to complete funding on a molecular research centre. It will also put $15 million towards a centre to study invasive species management in Sault Ste. Marie.
The budget's provisions for northern communities comes in the wake of a comprehensive report released last week which made recommendations on how the government could improve the economy in northwestern Ontario.
The province also noted that it is currently working with aboriginal groups and other stakeholders on a growth plan for the north.
