Commission on the Reform of Ontario's Public Services

Chapter 11: Business Support
Chapter 11: Business Support
Like many jurisdictions around the world, the Ontario government provides financial and
other forms of support to private businesses to foster investment and economic growth.
Many funding programs also aim to create jobs in the private sector, and are often targeted
at specific industry sectors and regions. Looked at from the perspective of the total fiscal plan,
however, discretionary spending on business support is not in the same league as spending
on education and health care — nor is it at the same level of priority. Yet it can have a
substantial impact on the economy — both good and bad. It is time for the government to
rethink and reset the province’s business support programs (commonly referred to as
“business subsidies”).
Economic Vision
Much of Ontario’s economic success was driven by advantages that no longer exist (such as a
competitive and often undervalued Canadian dollar, relatively free access to a rapidly growing
U.S. market and low-cost energy supplies), so a new direction is now required. 1
Ontario must chart a path that reduces Ontario’s reliance on the U.S. economy — a path that
features bold policy action by the provincial government in concert with other governments and
the private sector. Such a policy should include nine key ingredients:
� Top-quality labour force;
� Effective integration of immigrants into the workforce;
� World-class infrastructure, including transit;
� Reliable electricity system;
� Being a leader in the environment;
� Competitive tax system;
� Enhanced trade;
� Shift from dependence (social assistance) to labour-force participation; and
� Supportive federal policy.
1 The analysis in this section is drawn directly from Don Drummond and Derek Burtleton’s TD Economics Paper, “Time for a Vision of
Ontario’s Economy: Much of the Foundation of Past Economic Success Has Crumbled,” Sept. 29, 2008, downloaded from
http://www.td.com/document/PDF/economics/special/td-economics-special-db0908-ont.pdf.
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