Ontario finance minister defends cap-and-trade costs

The Ontario finance minister insists the new cap-and-trade legislation will “benefit all of us,” although regional leaders are concerned those added costs will be felt more heavily in the Northwest.

Charles Sousa was in Thunder Bay on Friday as part of his pre-budget consultation tour across Ontario, and addressed the city’s business community at a Chamber of Commerce leaders’ luncheon.

The minister faced questions about the impact of added costs from the Liberal government’s cap-and-trade policies, which will take effect on Jan. 1.

“We estimate what those impacts might be at the pumps, for example, and the mitigation that we now put in place to help everday Ontarians with their out-of-pocket on those issues,” Sousa said in an interview with news media following his presentation.

“That’s why we’re introducing re-fit programs for the residences, that’s why we’re working closely with businesses to have benefit from some of the proceeds of cap-and-trade and that will benefit all of us.”

Shuniah Mayor Wendy Landry, who also serves as the vice-president of the Northwestern Ontario Municipal Association, said costs are already higher in the North.

An estimated five per cent per litre increase in gasoline, as well as increases to home heating and electricity bills, will have a significant impact on those already struggling, she argued

“We’ve always felt the higher price of groceries, the higher price of fuel, higher price of everything in Northwestern Ontario,” Landry said.

“I think with this added tax being put on, the government needs to listen to us and our organizations in going forward and how we can subsidize or help those individuals so they are not being put in a position of choosing food over paying an electricity bill.

“I’ve seen some of those bills and they’re astronomical. If we want to encourage conservation for all of our citizens then I think transparency of that cap-and-trade tax has to be apparent as well. It has to be an individual item on our electricity and gas bills so people can see what that added cost on our bill is.”

Sousa said the proceeds from cap-and-trade, which are estimated to be $1.9 billion, will be used to develop green energy and economic development opportunities to transition existing users away from current methods, such as fossil fuels.

“There’s too many that are relying on traditional, antiquated systems that are expensive, that’s hard to deliver and is bad for their health,” Sousa said.

“What we’re proposing is something more innovative, something that allows them to benefit from more directly and we have to foster ways to deliver these services at a much reduced cost.”

The cap-and-trade won’t be a “direct hit” to Ontarians like a carbon tax or carbon pricing would be, the finance minister argued.

Ontario “can sit back and watch everybody else get ahead of us or we take a step now and lead the way” as global policy changes, Sousa urged.

“The world has started to recognize the need for us to lower carbon. The world is recognizing that the manufacturing of the past is not adequate. We’re not going to be competitive in assembly line work with low wages and smoke stacks,” Sousa said.

“That’s not where our strength is going to be. Our strength is going to be in new-age manufacturing and value-added technologies and sectors of innovations.”

Sousa also faced questions about the Ring of Fire, and told the audience he has “heard a lot of talk” but hasn’t “seen a lot of action” from Ottawa in developing the mining project.

He described the Ring of Fire as a project with the potential to generate $60 billion with the benefits felt for the next number of decades.

“We have to look at this in a long-term perspective. These are decisions we’re making for 10, 20, 30, 40 years,” Sousa said. “If you look at it in that context it’s a no-brainer for the feds, the province and the First Nations sooner rather than later.”

Michael Gravelle, the minister of Northern Development and Mines, said work on the project is ongoing and there are major decisions to be made on transportation infrastructure, as well as continuing to engage First Nations communities.

Gravelle noted the province has committed $1 billion for when the time is right.

“When we reach that point and we’ve got those decisions in place that will certainly strengthen our hand with the federal government,” Gravelle said.