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Fall Economic Statement Right Direction But More Urgency Needed

Published by Marie Morden on November 14, 2016

TORONTO (November 14, 2016) - Canadian Manufacturers & Exporters (CME) is pleased to see some of its members' top priorities reflected in the Fall Economic Statement, delivered today by Ontario Finance Minister Charles Sousa, including electricity rate mitigation and pension reforms. Now a great sense of urgency is required in making substantive changes.

"We are supportive of the measures to reduce electricity rates, including the HST rebate for small manufacturers and lowering the threshold for accessing the Industrial Conservation Initiative (ICI) program," said Ian Howcroft, Vice President, Ontario, CME. "However, we are concerned that these measures must go further to mitigate concerns around electricity costs and cap and trade."

Reforms to the Defined Benefit Pension Plan regime in Ontario are critical. Both the United States and Quebec have already made reforms that have put Ontario manufacturers at a competitive disadvantage. CME is urging the government to move quickly to a singular going-concern valuation approach for pension plan liabilities.

CME members have made significant reductions in Green House Gas emissions since the 1990s while production has increased. CME is concerned that the cap and trade program may add cost and administrative burden to manufacturers that do not exist elsewhere, particularly the United States. This cost differentially is now particularly significant in light of the recent US election.

"The government needs to move quickly, working with industry to ensure that manufacturers are not significantly competitively disadvantaged by the progress on cap and trade," added Howcroft. "Grant programs, tax incentives and other offsets are all critical to ensure that we can accelerate technological progress, and drive down GHGs without causing significant economic dislocation."

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