With Ontario in in the midst of a pandemic second wave, the economy is still in a fairly desperate condition. But that will have to change one day. To debate how to grow the economy in a post-pandemic world, The Agenda featured Jim Stanford, director of the Centre for Future Work; Trevin Stratton, chief economist for the Canadian Chamber of Commerce; Armine Yalnizyan, economist and Atkinson Fellow on the Future of Workers; and Pamela Cross, tax partner at BLG.
Mandate letters – The knowns, surprises, and what didn’t make the cut (PART II)
By: Mark Agnew, Senior Vice President of Policy & Government Relations, Canadian Chamber of Commerce
Part I of the blog series looked at some of the big issues impacting the numerous sectors of the economy. This second part looks at the surprises and some issues that did not make the cut.
Five sleeper issues
In the mandate letters there are a number of sleeper issues that have gone below the radar but that will impact businesses in various sectors:
- Competition policy – Competition policy debates have been heating up in Europe and the United States, with a big focus on tech platforms. This broad review of competition policies could have major impacts on numerous sectors and it was noticeable see a few sectors get singled out.
- Force labour in supply chains – This issue has seen increased focus with numerous legislative proposals and the changes USMCA brought in to ban the importation of goods made with forced labour. It’s now explicit that the government intends to bring in its legislation. This will have implications for how Canadian companies source products from abroad.
- Right to repair – There were legislative proposals in the last Parliament related to right to repair, which create obligations on companies for allowing owners of equipment to seek more means to repair equipment. This opens up lots of tricky issues around companies’ ensuring their proprietary IP remains protected. It’s flown under the radar, but is a big issue for product manufacturers as technology becomes complex and digitalization.
- NORAD modernization – NORAD is the bedrock of our continental defence with the United States and there is a modernization effort on the horizon. This will be a key one for both our national security and the industrial opportunities it can create for Canadian companies. Given past debates in Canada around missile defence and experience procuring major defence platforms, this should be an interesting one to watch unfold.
- Investment reviews – Investment Canada Act modernization is on the table. The legislation already provides significant latitude for the government to deny a foreign acquisition, so it’s not clear what else could be in store.
Five missing issues
As much as what was said matters, there were a number of issues that did not feature prominently, lacked detail, or were missing from the list:
- Supply chains – Supply chains received a nod in several mandate letters, but details still came up short across the board. The word supply chain means everything, but nothing, all at the same time. Some of these things are under our control, like managing the border, but other things like the cost of shipping containers are not under our control. The strain on the supply chain is real and consumers are seeing that on the price tags in the stores. The Chamber will have more suggestions in due course.
- Agriculture exports – Supporting the export capacity of the agriculture and agri-food sector has been flagged in numerous reports over the last few years. Yet, our members face some steep barriers, particularly in trying to take advantage of the Canada-EU trade agreement. There was not much specific on those issues in either the trade or agriculture mandate letters, other than perhaps a brief allusion. If we’re serious about the agriculture industry in this country it’s a tough nut we will need to crack.
- Excise tax – Although the Chamber has long been pressing for a comprehensive review of the tax system, there are specific issues members want to see resolved at it relates to excise tax. One example is the automatic increases every year in the tax on alcohol products, but members in the cannabis sector also want another look at their excise tax rates (as an aside the mandate letters were also silent on the Cannabis Act three-year review that should have started this past October).
- Regulatory – If there was a third certainty in life alongside death and taxes, it would be regulations. Most people wouldn’t know by the name, but the Treasury Board Secretariat plays a critical role in managing how the federal government regulates, which impacts most sectors of the economy in some form. There was a general mention of regulatory reform, but still nothing on adding economic competitiveness mandates to regulators nor anything on regulatory cooperation with our closest trading partners to more effectively use the Regulatory Cooperation Council with the United States or the Regulatory Cooperation Forum with the European Union.
- Border – Managing the border has been a hot topic during the pandemic, but the challenges ailing our border competitiveness well pre-date the pandemic. There was a brief mention of modernizing infrastructure and processes at the border, but an absence of a focus on commercial programs and ensuring major program overhauls, like the CBSA Assessment and Revenue Management (CARM) project are properly deployed.
Parts I and II of this blog are not exhaustive, but a sampling of some of the things out there. With a finite number of hours in the day for the government to drive forward its agenda, the key for the Chamber and our members will be pressing the economic growth narrative and advocating for the specific measures that will get us there.