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Under leadership of the Coalition Avenir Quebéc (CAQ), the Quebec government released its budget for 2020 today. Maintaining provincial popularity a year and a half after election, Minister of Finance Éric Girard announced a balanced budget focused on green initiatives. It is worth noting that the Minister of the Environment will soon present his Plan for a Green Economy (PEV) 2030, which will benefit from funding of $6.2 billion continuing until March 2026.

Additionally, the 2.8 per cent real GDP growth in Quebec means that the government can afford spending $118.6 billion—an increase of 5.1 per cent from last year’s budget.

Building a green economy

This year’s budget announced an investment of over $6.2 billion over a period of six years to make Quebec an environmental leader, prepare the province for the effects of climate change and meet 2030 targets for reducing greenhouse gas emissions.

This direction fits into the “open for business” narrative of the CAQ, as the government will focus on attracting green investments and developing low-carbon sectors, as well as taking full advantage of Quebec’s hydroelectricity.

Those environmental commitments continue well into the public transportation sector, as the CAQ will invest $15.8 billion for electric public transit projects in Québec City, Gatineau, Montréal, Laval, Longueuil and Chambly. The government will also continue to support electric vehicle acquisition with their Roulez Vert program, with an investment of $1.4 billion over six years.

Wealth generation in the province will also be focused on the environmental transition. As such,the government will support businesses in the industrial sector with $1.3 billion to encourage decarbonization.

Education, Regions and Health

In the next five years, the government will implement policies totalling $5.8 billion, which include the following initiatives.

With this budget, the CAQ reminds Quebecers of their electoral promise to put money back into their pockets, with another step toward a single school tax rate that will return $182 million to homeowners this year alone.

The CAQ also continues to deliver on its promise to increase spending in education, with $1.5 billion invested, including $471M for new services and $550M to boost the number of college and university graduates.

While the CAQ, who is decidedly pro-business, will invest $1 billion over the next five years to improve business productivity and competitiveness, the government also reiterates its emphasis on supporting the regions with $1.5 billion to boost economic development and develop natural resources in those parts of the province.

With the novel coronavirus reaching Quebec recently, the government announced $5.4 billion of spending in health services, a 5.3 per cent from last year—with $1.1 billion for this year alone.

The government has released simultaneously its Infrastructure Plan of $15 billion.

Finally, while Eric Girard’s budget speech highlighted the government’s decision to focus on culture, the announcement should be put into perspective with the comparatively low investment of $407 million.

Quebec economic context

Remarkable economic growth and rising standards of living

Eric Girard boasted Quebec’s 2.8 per cent real GDP growth in 2019, a remarkable performance which contrasts with that of Ontario and the country federally for the same period. The government is projecting growth of 2 per cent for 2020.

Debt reduction

The government confirmed that the goal to decrease gross debt to 45 per cent of GDP is being achieved six years earlier than expected. The objective of reducing the debt representing accumulated deficits to 17 per cent of GDP is expected to be achieved by March 31, 2023—three years earlier than expected. Gross debt reduction will allow Quebec, among other things, to improve the financing of public services and invest more in infrastructure.

A balanced financial framework

The financial framework presents a budgetary balance, within the meaning of the Balanced Budget Act, of $1.9 billion in 2019-2020. The government forecasts a balanced budget in 2020-2021. The favourable economic situation makes it possible for the government to announce additional initiatives to further meet its commitments.

Half of Canadians believe Canada
is in the midst of a national unity crisis

More than 80 per cent of Canadians are unaware of
Alberta’s financial contribution to Canada

CALGARY, Feb. 13, 2020 – A research study released by Navigator Ltd. found that 51 per cent of Canadians believe Canada is in the midst of a national unity crisis. Further, one-third of Canadians believe Alberta is the largest threat to national unity, second only to Quebec (50%).

“What we’re seeing is a real desire and acceptance across the provinces for greater provincial power and autonomy in response to concerns about national unity,” says Randy Dawson, Managing Principal at Navigator Ltd. “The West wants to be heard, but most of all, they want a federal government that acts on their concerns.”

Nationally, more than half of Canadians feel that the federal government has lost touch with their province, ranging from 77 per cent in Alberta to 57 per cent in Quebec. A significant number (38%) of Canadians also believe Albertans and Saskatchewanians have a legitimate reason to want to separate from Canada.

There is a significant division in Canada on the issues of national unity, particularly between Alberta and Quebec. With regard to the energy sector, Albertans want more pipelines built, but they do not want to stifle green energy at the expense of oil. Nearly two-thirds of Albertans and Quebecers believe more investment in solar and wind energy is beneficial; however, 74 per cent of Albertans and only 25 per cent of Quebecers agree more oil pipelines should be built. (For the rest of the country, the number is 49%.)

Perhaps most concerning from Alberta’s standpoint is that less than 20 per cent of Canadians are aware of the economic contributions Alberta makes to Canada.

“As the Prime Minister attempts to weave a balance between the environment and the economy, he does so against a backdrop of a potential national unity crisis in a minority parliament,” says Dawson. “This will be further exacerbated by issues that will define these challenges and test his national leadership on issues such as the impending Teck Frontier mine decision.”

More than 2,500 Canadians participated in the national survey from Jan. 3 to 10, 2020.

We’re thrilled to welcome former Premier of New Brunswick Brian Gallant to Navigator as a Senior Advisor in our Toronto office.

In addition to his role as Premier, Brian served New Brunswick as the Attorney General, the Minister responsible for Innovation, and the Minister responsible for Women’s Equality. He was also  Chair of the Council of the Federation. An experienced political leader, lawyer and entrepreneur, Brian is actively engaged in cybersecurity, technology and sustainability issues through his work with Ryerson University, NGO Global Canada and numerous boards of directors.

At Navigator, Brian helps leaders navigate complex issues at the intersection of government, politics, business, law, social justice, media, and sustainability.