Newspaper article The Canadian Press

Slow and Steady Only Way to Go on Infrastructure Funding, Morneau Says

Newspaper article The Canadian Press

Slow and Steady Only Way to Go on Infrastructure Funding, Morneau Says

Article excerpt

Infrastructure money can't move fast: Morneau

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OTTAWA - The finance minister would like to see billions in new federal infrastructure money flow faster to provinces and cities, but Bill Morneau says that moving too fast would risk wasting money.

The federal Liberals have come under heavy criticism from the parliamentary budget watchdog for the pace of infrastructure spending that the government sees as a pillar of its strategy to spur economic growth and help pay for deep deficits.

Morneau said the Liberals have approved about 1,300 projects with a total value of about $6 billion -- and more are being reviewed.

"When we get criticized for not making the investments quickly enough, I listen and I think we have to make sure we do get at it quickly," Morneau said during an interview with Huffington Post Canada broadcast live on Facebook.

"But I will tell you that we would get criticized a whole lot more if we made the investments too fast and wasted money, so we're not going to do that."

Wednesday's budget showed between 50 and 75 per cent of the infrastructure money was on track to be spent this fiscal year, which ends next week.

The lack of federal spending doesn't mean money isn't being spent on projects.

The federal government only reimburses cities and provinces for work once receipts are submitted, meaning there is usually a delay between construction and money flowing from the federal treasury. And money that isn't spent in one year remains available for cities to spend in the future.

The Liberals predicted that their first tranche of infrastructure money along with a slew of other tax and spending measures would buy about half a percentage point of economic growth in the 2016-2017 fiscal year.

Morneau's second budget says the economic impact will likely end up being four-tenths of a percentage point, owing to slower-than-expected infrastructure spending.

The 2017 budget provided more details about the second phase of the Liberal infrastructure plan, including how much of the tab the federal government will pick up. …

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