More spending and more taxes have many business groups concerned about the future after the federal government released its ambitious 2024 Budget yesterday.
"Canada must end the cycle of tax and spend politics," Canadian Chamber of Commerce Senior Director of Fiscal and Financial Services Policy Jessica Brandon-Jepp said. "Fueling economic growth is the key to improving quality of life and affordability for Canadians." The national chamber network opposes any measure that increases costs for businesses currently experiencing economic headwinds. We also will work with our members to understand how the increase to capital gains tax will impact business. "(The) budget contains few surprises. Most of the major new spending was announced by the government over the last few weeks, and the government’s projections for the deficit are largely in line with previous predictions," Canadian Chamber CEO Perrin Beatty said. "Our lagging productivity and stalled GDP growth means Canadians are becoming collectively poorer and working harder to just remain where they are today." New taxes will cover about $18 billion with about $57 billion in added spending:
Another successful AGM is nothing new for your 161-year-old Chamber, but the expert panel convened for yesterday's meeting could not have been more topical.
"Safe communities is a long-standing advocacy priority for us, and we know there is no simple solution," Chamber CEO Bruce Williams said. "A true fix requires a collaborative approach, though as we learned yesterday there are things we can do to improve symptoms while we work on more permanent solutions." After a series of reports of violent incidents in media, Chamber members had many questions about policing, mental health support and housing services. The need for more homes for all income levels is clear, as is a requirement for adequate health care and addiction treatment professionals. Those solutions will take time, even as the political will grows to invest in foundational change. While mistakes have been made, including in the early days of the pandemic when screening for supporting housing wasn't as closely monitored as it is now, progress is being made. The Chamber is working on policy issues such as legal reforms to keep repeat offenders off the street, and police are partnering with health authorities to enforce laws while assisting people in distress. "We can't ignore these issues facing the business community, but we also have a responsibility to not sensationalize them," Williams said. "Going Downtown is safe and our region really is one of the best cities in the world. That said, as with any city, if you don't feel safe, stay away from the few spots that are troubled, stay informed about what governments are doing and let's all be part of positive change." The slight increase to inflation reported yesterday is not outside the range that could jeopardize an anticipated interest rate cut in June.
Statistics Canada reported yesterday that the Consumer Price Index rose to 2.9% in March — up from 2.8% in February. Gas prices were the biggest reason for the rise. Without those fuel costs, March's inflation actually slowed from the previous month. "Many inflation indicators are trending in the right direction and interest rate cuts are still on the table for the Bank of Canada’s interest rate announcement in June," the Conference Board of Canada stated, adding that getting to 2% inflation target could take awhile. Many employers are forecasting wage growth and consumers still see prices rising in the months ahead. "While there is still one more CPI release to come before the Bank's next policy decision, (yesterday's) data keeps us on track to see a first rate cut at that June meeting," CIBC Executive Director of Economics Andrew Grantham said. A new waterfront neighbourhood has been proposed for the area around the Capital Iron District. In an article in the Times Colonist, Reliance Properties CEO Jon Stovell said its plan for an arts and innovation district will go before City of Victoria council on April 18.
The proposal includes preservation of heritage buildings along Store Street and 12 new buildings over two city blocks adjacent to the Upper Harbour. The area known as the Capital Iron lands is bordered by Chatham, Discovery and Government streets. If the proposal is approved, the area will be home to 500 new housing units and provide working space for 1,800 people. It will also serve as a new home for the Art Gallery of Greater Victoria. What would you do to make Victoria feel safer? Have your say by participating in the City of Victoria's Community Safety and Wellbeing Plan
“This public engagement will help us understand people’s thoughts, feelings, perceptions and opinions about wellbeing and safety, and encourage them to share their ideas on possible solutions,” Victoria Mayor Marianne Alto said in a news release. “Our Community Safety and Wellbeing Plan will include strategies to enhance the quality of life for our community — residents housed and unhoused, businesses, non-profits, workers of all kinds — to create a community that is safe and inclusive for everyone. The Plan will tackle a range of social issues, embracing an array of solutions.” The survey is available online until May 12. A draft of recommended actions will go to City Council in September. Using available land on military bases for direly needed homes for military personnel can help solve Canada's housing crunch.
The Chamber is currently crafting a policy resolution on this solution for our national network to take to the federal government. This week, we heard good news from the feds. The defence policy update titled Our North, Strong and Free includes almost $300 million for Canadian Armed Forces Housing over 20 years. "Chamber members tell us one of the biggest hurdles for finding and keeping workers is the cost of housing in Greater Victoria," Chamber CEO Bruce Williams said. "We have thousands of Armed Forces personnel in our region, and providing more, quality housing on CFB Esquimalt land will free up homes off base for other workers." The update announced a total of $8.1 billion over five years and $73 billion over the next two decades to bring Canada closer to its NATO commitment. A longstanding concern has been addressed by proposed changes to the Police Act. Under the current rules, the chair of the local police board is automatically the person serving as mayor of the local municipality. That can create an appearance of conflict as councils must approve budgets recommended by the police board.
The new rule will allow local governments to determine who their representative will be on their police board and will allow members of the police board to elect their chair and vice-chair. "This is an important update as it will remove politics from the important decisions around ensuring police are adequately funded," Chamber CEO Bruce Williams said. "Having appropriate resources is fundamental for police so they can continue to keep our communities safe." The District of Saanich's plan for the area around Uptown received a boost on Monday as the province announced it has secured land for a new transit-oriented development.
“Our communities are growing quickly, and people need affordable homes close to public transit, so they can get to where they need to go – and get ahead in life,” said BC Premier David Eby, who will be speaking to Chamber members on April 30. “This new development in Saanich will create a vibrant, connected community where people can find everything they need at their doorstep.” The land was bought by the BC Ministry of Transportation and Infrastructure’s $394-million property acquisition fund. Early plans for the area in Saanich include hundreds of new homes, public spaces and active-transportation connections. There will also be new retail and commercial spaces. Other suggested services include child care, community health and educational facilities. The development will integrate the Lochside and Galloping Goose regional trails to make it a hub for active transportation and BC Transit services, with connections to downtown Victoria, the University of Victoria, the Westshore and the Saanich Peninsula. “The Uptown-Douglas area is the perfect location for a high-density, transit-oriented development and regional transit hub that will no doubt be transformative for this community," Saanich Mayor Dean Murdock said in the news release. Luke Mari, principal of Aryze Developments commented on the announcement, saying “The best transportation plan is a land-use plan. When we put the right homes in the right places – near existing services amenities and transit – we can reduce our dependence on private car use.” Hurry up and wait. That seems to be the message from the Bank of Canada today, after it held its target for the overnight rate at 5%. The Bank's Governing Council would like to see evidence that inflation will continue to trend down before announcing cuts. Optimism remains that there will be enough evidence by the time the Bank makes its next rate announcement on June 5.
"We currently forecast a first interest rate cut in June," CIBC Executive Director of Economics Andrew Grantham said in a media release. "To steal a line from (Bank of Canada) Governor Tiff Macklem's press conference today, that outlook still appears to be within the realm of possibility." The provincial government received another slap for its spending habits from the world's largest credit rating agency.
On April 8, S&P Global Ratings downgraded BC from AA to AA-minus, the third drop in a row from the firm. Shortly after, Moody's Investors Service also lowered its rating of the province. The downgrades increase debt servicing costs for the province, taking away from funds that could otherwise go to infrastructure or other services. The S&P report said it could lower the rating further unless a better plan to manage provincial deficits emerges. "We believe that the province's commitment to fiscal discipline and stability has wavered in recent years as BC has materially increased its spending for both operations and capital investment to unparalleled levels, while economic growth is slowing," the report said, offering some positive feedback as well. "Overall, BC's financial planning practices are well aligned with those of domestic peers and are transparent." BC Premier David Eby and Housing Minister Ravi Kahlon announced new rules yesterday to give landlords and renters more certainty regarding tenancy agreements. The proposed amendments to the Residential Tenancy Act will increase flexibility and provide clearer guidelines for issuing evictions.
“While most landlords and tenants play by the rules and have respectful relationships, too many people in BC are still facing unfair rent hikes and evictions under false pretenses,” Eby said in the media release. “At the same time, many people who have chosen to rent part of their home are struggling to end problematic tenancies.” Under the new rules, rent increases will be restricted when a family adds a child under 19 to the household. Landlords also will need to give tenants a longer notice before taking over a unit for personal occupancy. "The Chamber supports policies to increase the supply of stable housing," Chamber CEO Bruce Williams said. "This requires a balance between protecting renters and making sure the rules aren't so onerous they prevent potential landlords from renting out available units." Williams said housing will be a major topic of discussion when The Chamber hosts Premier Eby on April 30. Register now to reserve your seat at the table. Leading to Election - Breakfast with Premier David Eby
The jump at the pumps was no April Fool's prank as the tax on gasoline increased on April 1 to $0.17 cents per litre from $0.14 per litre.
BC has had a carbon tax since 2008. The provincial tax is separate from the federal tax implemented in many other provinces. As such, the rebates available to Canadians in those provinces are not the same as those offered here. In BC, carbon tax rebates are income tested and only available to those earning less than $61,465 per year. "The Chamber supports climate action leadership, and the idea of a carbon tax has its merits," Chamber CEO Bruce Williams said. "What needs further examination is how the revenue from this tax is being used. We know innovation led by business is key to finding climate change solutions and that requires reducing the burden on the private sector." The Bank of Canada released its Business Outlook Survey as well as its Survey of Consumer Expectations this week.
The findings show that business conditions have improved in the first quarter of 2024. It's the first positive change in almost two years. The survey also found that fewer Canadian businesses are planning for a recession this year. There was more good news as labour constraints and supply chain challenges are less of a problem. However, businesses reported facing new burdens from taxes and red tape. Consumers said inflation and interest rates are affecting their household budgets, though there was less pessimism about the future of the economy and job prospects. Greater Victoria's real estate industry appears to be back in season.
"We have more inventory for consumers to consider when compared with recent years. This additional inventory improves both buyer and seller confidence as it means people have more options and more reassurance that they are going to be able to find their new home," Victoria Real Estate Board Chair Laurie Lidstone said in a media release. "As people buy and move, more properties are added to the available inventory, which supports a much healthier market. Supply really is key, and looking to the future we need to ensure that focus continues on the creation of new homes of all types and price points." VREB reported 2,647 active listings at the end of March 2024 — up 12% from February and 34.4% March 2023. In the core area of our region, the benchmark value for a single family home in March 2024 was $1,279,300, up from February's value of $1,247,400. The benchmark value for a condominium in March 2024 was $567,300, up from $557,000 in February. Peter Hayman is the new leader of Vancouver Island South Film & Media Commission. Hayman will replace current film commissioner Kathleen Gilbert, who is retiring April 30.
The not-for-profit organization promotes Greater Victoria as a premier location for the international film industry. The commission has its roots as a Greater Victoria Chamber of Commerce committee, starting in 1974, before it became the Victoria Film Commission in 1983. Hayman lives in North Saanich and was a studio musician and songwriter who studied film at UCLA, and worked as a film editor, producer and director. He founded a production company and has experience integrating new and traditional media. “I look forward to sharing my own enthusiasm with those looking for the perfect place to create their film and media projects,” Hayman said in a media release. Six new projects in Greater Victoria funded in part by the province will provide 765 affordable rental homes. Two sites, owned by the Luther Court Society, in the District of Saanich at 1525 Cedar Hill Cross Rd. and 3781 Cedar Hill Rd., will be home to 95 new units of intergenerational housing with community support space on the ground floor.
“I’m thrilled to see support from BC Housing’s Community Housing Fund going toward several innovative projects in our community," Saanich Mayor Dean Murdock said. "Once completed, they will provide affordable rental homes for families, students and seniors. We want to provide housing for people at all life stages that provides a high quality of life, and these projects certainly contribute to these goals.” Other projects in the region include:
"The need for housing supply in our region is great, and even small efforts help," Chamber CEO Bruce Williams said. "We want our region to be attractive for people to live, start a family and build a career and affordable housing is key to making that happen." The rules targeting short-term rentals in BC have been updated to provide a little more clarity.
The Short-Term Rental Accommodations Act takes effect May 1. The updates, once approved, will include an exemption from the principal-residence requirement for certain strata-titled hotels and motels, so they can continue to operate. Strata hotels and motels consist of individually owned strata lots, where accommodation is provided in a manner similar to a hotel or motel. The definition requires the facility meet certain criteria, based on whether they were operational before Dec. 8, 2023. "The Chamber has been at the forefront of calling for increased housing supply, but we also stand for fairness and have called on government to protect purpose-built visitor accommodation," Chamber CEO Bruce Williams said. "Difficult decisions are required to find the balance between having enough rooms to adequately support our important visitor economy, and ensuring there are enough homes for all residents." Now more than ever it is vital for governments to reduce the burden on business to spur the investments needed to increase productivity. Doing so will inoculate our economy against runaway inflation, said the Bank of Canada's Senior Deputy Governor Carolyn Rogers on March 26. "An economy with low productivity can grow only so quickly before inflation sets in. But an economy with strong productivity can have faster growth, more jobs and higher wages with less risk of inflation," Rogers said. "That’s why I want to talk about Canada’s long-standing, poor record on productivity and show you just how big the problem is. You’ve seen those signs that say, 'In emergency, break glass.' Well, it’s time to break the glass." Rogers said there was a spark of hope during the pandemic as business showed resourcefulness and ingenuity. However, unlike what is happening in the U.S., Canadian firms reverted to low levels of productivity from before the pandemic. To increase productivity, businesses and their employees need three things:
"Weak investment has been a problem in Canada for a long time. You can go back 50 years and find a persistent gap between the level of capital spending per worker by Canadian firms and the level spent by their US counterparts," Rogers said, noting it's harder for new businesses to compete and too much red tape reduces the incentive to change and evolve. "Higher productivity should be everyone’s goal because it’s how we build a better economy for everyone," she said. "When a business gives workers better tools and better training, those workers can produce more. That, in turn, means more revenue for the business, which allows it to absorb rising costs, including higher wages, without having to raise prices." The BC Provincial Nominee Program is being updated to help people new to Canada better understand what is required to be nominated for permanent residency through the BC PNP. The program is the provincial government's only tool for directly selecting immigrants for permanent residency. The program currently prioritizes workers in health care, construction, early childhood education and other in-demand jobs.
"The BC PNP is competitive, but some recruiters misrepresent it as an easy pathway to permanent residency," the provincial media release said. "These updates will give people a better understanding of the education, experience and language skills that they need to be considered for nomination. The program updates align with new measures to protect international students from predatory institutions and recruiters, such as:
"The Chamber continues to work closely with our region's post secondary schools to support their highly successful international student programs," Chamber CEO Bruce Williams said. "The University of Victoria, Camosun College and Royal Roads University have set the bar for the country when it comes to attracting and training people who contribute to our country." A recently released report by Grant Thornton says Canada's real estate industry is looking for optimism in uncertain times. The report highlights current trends impacting the real estate industry, as well as trends across residential, retail, office, industrial and alternative asset classes.
Ongoing concerns include developmental pressures created by a shortage of labour in construction, environmental challenges as governments try to meet climate change targets and stubbornly high interest rates that are dampening investment. "The general economic uncertainty we currently face has left many organizations with less appetite for risk and a resultant focus on risk management," the report states. "To secure financing, borrowers need to get out ahead of their lenders and present a balanced risk profile. It will be increasingly important to present a transparent financial picture, get to know your lenders more closely, and get in front of renewals earlier in the process so that you have time to address potential concerns. Borrowers with less liquidity or poor cash flow are going to have a more difficult time securing financing, and those that do will see less favourable terms." The Save Our Streets coalition released a statement today saying a report by BC's Auditor General confirms that the province is failing to address the toxic drug crisis as record numbers of people continue to lose their lives.
“BC must learn from this report and the policy failures such as those recently recognized in Oregon and refocus on designing and implementing a comprehensive continuum of care for those suffering from addictions and mental health issues,” said Jess Ketchum, co-founder of SOS, which consists of more than 90 organizations including the Greater Victoria Chamber of Commerce. "The Chamber has been vocal about the fundamental importance of Safe Communities, and we continue to advocate for a sharp increase in treatment beds and recovery facilities as well as needed repairs to our legal system to make sure repeat offenders are kept off our streets," Chamber CEO Bruce Williams said. To hear more about work being done to promote Safe Communities, make sure to register now for The Chamber's AGM on April 16 featuring:
The Royal BC Museum's new archives, research, and collections facility will be officially known as the Royal BC Museum PARC Campus.
The Provincial Archives, Research and Collections reflects "the critical and complex work that will take place in this state-of-the-art facility," the museum's media release said. The museum's new campus is in the City of Colwood, on the territory of the Songhees and Esquimalt Nations. The facility will be open to the public, "providing opportunities to learn more about BC’s past, provide greater accessibility to the collections, and foster a connection between all peoples of British Columbia and this provincial museum." The PARC Campus, designed with mass timber construction and LEED Gold certified, is scheduled to open in 2026. For the second month in a row, Canada's inflation rate was lower than expected. That's good news for everyone feeling the pinch of higher costs.
"The Consumer Price Index rose 2.8% on a year-over-year basis in February, down from 2.9% in January. Notable contributors to the deceleration included the indexes for cellular services, food purchased from stores, and Internet access services," Statistics Canada said in its media release. Offsetting the deceleration was a year-over-year increase in gas prices, which rose 0.8% in February. "It’s great to see headline inflation move further within the target range, and core inflation continuing its downward trend. We could see that the market was expecting a slightly higher inflation print, due to gasoline prices rising in February, but grocery store prices have slowed, and short-run core momentum measures are tracking around two percent. That’s going to be welcome news for households," Canadian Chamber of Commerce Senior Economist Andrew DiCapua said, adding the Bank of Canada will see the latest figure as a signal its fight against inflation is working. "But we shouldn’t expect any moves from the Bank until June. With two more inflation updates, updated surveys on expectations, and a Federal budget, the Bank will want to see the data and build a case for any changes before they present anything to Canadians." The national network of Chambers of Commerce has big shoes to fill, after current CEO Perrin Beatty announced he is stepping down from the Canadian Chamber on Aug. 31.
Beatty's leadership during the pandemic provided critical support for business by advising governments. This led to a fundamental shift in the Canadian Chamber’s mandate and structure. “Not only have we added new tools and services for Canadian businesses and chambers and boards of trade across the country, but we have grown substantially, doubling our revenues over just the last four years,” said Beatty, who is the longest serving leader in the national organizations 99-year history. “Along the way, we have modernized our governance structure, built a skilled and respected team, strengthened our grassroots network of chambers and boards of trade and provided a strong and influential voice for Canada’s business community.” Greater Victoria Chamber of Commerce CEO Bruce Williams worked with Beatty on several initiatives over the past four years. "Perrin is a master communicator and connector, and I'm grateful for having the chance to learn from him," Williams said. "He recognized that growing the national chamber required listening to and supporting regional chambers such as the Greater Victoria Chamber of Commerce. The symbiotic relationship we built has made our organizations more resilient than ever." Canada's Finance Minister and Deputy Prime Minister Chrystia Freeland made a surprise visit to Victoria on Monday for a meeting with BC Premier David Eby. With the federal budget coming on April 16, Freeland was in town to promote her government's investment in housing across Canada. "For me, it's actually pretty simple," Freeland said at a media event ahead of her meeting with Eby. "It's housing, housing, housing. Supply, supply, supply, affordability, a strong economic plan that delivers great jobs and a real focus on younger Canadians." Freeland stated $34 million in federal funding has helped create homes in Greater Victoria — something the Greater Victoria chamber continues to call for to help our region meet the demand at the root of housing affordability. Freeland highlighted Sawyer Block on Fort Street, which has 60 rental apartments, and a project in Cook Street Village that helped build 47 rental apartments. "Through the Apartment Construction Loan Program, we will also be offering low-cost loans to post-secondary institutions — like the University of Victoria ... so that they can build more student housing on- and off-campus," Freeland said in her presentation. "This will help more students to find housing they can afford close to where they study, and at the same time, it will mean that there are more homes available for those who live in those same communities year-round." Adding on-campus housing is another long-standing chamber advocacy priority, Chamber CEO Bruce Williams said. "This is a big win for our advocacy work. We know that one of the biggest challenges for building homes in Greater Victoria is our land constraints," Williams said. "Post-secondaries have the space. They need the right financing to make housing work and this is part of that solution." |
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