Prince Edward Island will be receiving an additional $9 million this year in transfer payments from the federal government as part of the 2013 federal budget, says Canada Revenue Minister and Egmont MP Gail Shea.
The budget was released in Ottawa Thursday, and its restrictive spending targets show the Harper government remains firmly committed to reducing the federal deficit and reigning in spending.
Nonetheless, equalization, health and social transfers to the provinces have increased this year, including those to P.E.I.
“If you look at equalization alone, since 2006 when (we) formed government, that has increased by $63 million, or 23 per cent,” Shea said Thursday.
The health transfer to P.E.I. has increased by almost 40 per cent within that time frame and the social transfer has gone up by 30 per cent.
Shea also pointed out several measures within Finance Minister Jim Flaherty’s budget address Thursday that will provide other means of support for Islanders and P.E.I. businesses over the next several years.
One of those measures is one that both the province and municipalities were hoping for – a renewal of the federal infrastructure fund. This fund will be worth $47 billion over 10 years, starting in 2014.
A key feature of this program is that it will provide base funding for all provinces, which is good news for the Island.
“That is so important to smaller jurisdictions like ourselves,” P.E.I. Finance Minister Wes Sheridan said in an interview Thursday.
“It’s very important to give smaller provinces the same swat at this infrastructure money.”
The province has been in talks with the federal government for the last several years to try to get help in paying for a third underwater power cable to the mainland.
This costly venture has been identified as a necessity, since the two existing cables are over 30 years old and are operating at close to maximum load capacity.
Sheridan said the cable is now the No. 1 infrastructure priority for P.E.I. and is hoping the new infrastructure program could help to bring it into reality.
Shea indicated there could very well be an opportunity for federal funding for the estimated $80 million project.
“The province has identified the cable as their priority so we have a number of avenues that they could pursue… so that’s certainly a possibility but that will have to be discussed with the province.”
Another program that will impact the province announced by Flaherty Thursday is a new Canada Job Grant. This will replace existing labour market agreements with the provinces and will see provincial governments begin footing the bill for a third of each $15,000 training grant that will be available through this program. Ottawa and the employer will chip in the remaining amounts.
In his budget address, Flaherty said this change is being made to address a disconnect between the training programs currently being offered and the skills that are required to fill jobs across the country.
Sheridan said he would wait and see what effects this could have on existing skills training programs and budgets within the provincial Innovation Department.
But Shea said this new initiative is a necessary one.
“Obviously what we were doing wasn’t working if we have all these employers looking for people and there seems to be a mismatch of skills to the jobs,” Shea said.
“The federal government is taking a leadership role to benefit the economy and to help the job creators, which is where we thing real economic growth is. Governments can’t grow the economy, it’s the private sector that has to grow the economy.”
Overall, Flaherty’s 2013 budget is one of fiscal restraint with less than one per cent in new spending over last year.
Sheridan said this was what he expected as the feds and governments across the country work to tackle their deficits while also dealing with sluggish economic growth.
“This is probably the most lean federal budget growth than we’ve seen in the last 20 years, but that’s what it is and that was to be expected,” Sheridan said.